Settlement services in the VP system - Denmark

29.11.2018

Note: Settlement services in the VP system are solely for non-T2S eligible securities. For the remainder please see Settlement Services in T2S - Denmark.

Pre-matching service

The table below summarises CBL’s pre-matching service for external settlement instructions, as well as the pre-matching method and start time in the market. For details of CBL's pre-matching services, see Pre-matching services for external settlement instructions.

Service offeredMethod employedStart (local time)
All securities

Release of pre-matching instruction (limited to outside the provisioning period) followed by a settlement instruction

Automated through VP Securities' system

On receipt of instructions

Domestic allegement matching service

Complementary to the pre-matching services offered as described above and where no pre-matching instruction has been sent to the market, CBL accepts allegements via its depository from domestic market counterparties. It will then use these allegement messages to search for the best matching customer instruction.

If no matching customer instruction is found, the allegement is reported to the customer provided that its Clearstream Banking account number is present.

For details of CBL's domestic allegement service, see Pre-matching services for external settlement instructions.

Procedures for domestic counterparties

Procedure for the domestic counterpartyDeadline
Receipt in CBL / Delivery from CBL
CBL’s VP code 11900
CBL customer's BIC11
Matching to be done with Danske Bank by 17:00 SD-1 to participate in the night-time settlement cycle

Market deadline

Note: CBL accepts internal and domestic settlement instructions in most Danish debt securities with DKK decimal nominal amounts. Bridge instructions are not allowed for settlement with decimals.

Allowed countervalue difference

The following cash tolerances will apply to instructions:

  • 15 DKK for settlement amounts up to or equal to 750,000 DKK
  • 187 DKK for settlement amounts above 750,000 DKK

In the case of a discrepancy, the cash amount of the delivering party will prevail.

Specific settlement rules / settlement restrictions

Trade date is mandatory in all settlement instructions and must be no later than the settlement date.

The instruction must be in line with the counterparty’s standard settlement instruction and the format of settlement instructions must be in line with respective instruction specifications (see below).

Formatting of instructions

The following recommendations and rules apply to the format specifications for settlement parties in instructions, as indicated.

Note: A VP code provides exact information about a specific counterparty whereas a single BIC code may relate to several VP codes. VP codes are available from the VP website.

If the counterparty is a direct participant in the Danish CSD, the instruction must include:

  • The VP code in the Receiving/Delivering Agent field; no additional details are required.

Example:

Xact via SWIFT and Xact File TransferCreationOnline
:16R::SETPRTY
:95R::REAG/VPDK/12345
:16S::SETPRTY

Receiving Agent

Format
Party
VPDK - DK
12345

If the counterparty is the client of a direct participant in the Danish CSD, the instruction must include:

  • The VP code in the Receiving/Delivering Agent field; plus:
    • The Safekeeping Account of the Receiving/Delivering Agent; or
    • The Seller/Buyer BIC.

Example:

Xact via SWIFT and Xact File TransferCreationOnline
:16R::SETPRTY
:95R::REAG/VPDK/12345
:97A::SAFE//0123456789
:16S::SETPRTY
Receiving Agent


Account
Format
Party
VPDK - DK
12345

0123456789
OR
:16R::SETPRTY
:95R::REAG/VPDK/12345
:16S::SETPRTY
:16R::SETPRTY
:95P::BUYR//ABCDDEFFXXX
:16S::SETPRTY
Receiving Agent


Buyer
Format
Party

Format
Party
VPDK - DK
12345

BIC
ABCDDEFFXXX

Rules for Buyer/Seller

If the Buyer/Seller is identified by BIC, the Buyer/Seller Safekeeping Account must not be provided.

N.B.: An exception to this is if the counterparty’s agent is Danske Bank (VPDK/04444 or BIC DABADKKK), in which case, the Safekeeping Account must be provided and should be the 10-digit Danske Bank account number.

If the Buyer/Seller is identified by name and address, the respective Safekeeping Account must be provided.

Back-to-back processing

Back-to-back processing is available for transactions in all dematerialised securities eligible in this market. If both the customer and the domestic counterparty meet their settlement obligations and fulfil the market's back-to-back requirements within the relevant deadlines, the linked receipt and the linked delivery will settle with same-day value. To benefit from this functionality, customers must ensure that their back-to-back instructions are formatted as follows, according to the connectivity medium used:

Connectivity mediumPool ID formatField(s) to be used

CreationOnline

16x a
and
Turnaround
Pool Reference

Type of Settlement Transaction

Xact via SWIFT and Xact File Transfer

:POOL//16x a
and
:SETR//TURN
Field :20C: sequence A1

Field :22F: sequence E

a. The reference (16x) must neither start nor end with a single slash ’/’ nor must it contain two consecutive slashes ’//’.

Management of failed instructions

Although, in accordance with standard procedures, unsettled receipt against payment instructions are automatically cancelled 30 calendar days after the requested settlement date, CBL reserves the right to cancel receipt instructions that have not settled by the fifth domestic business day after the requested settlement date and have not been re-confirmed by the customer.

Settlement instructions that have been matched in the market may only be cancelled bilaterally.

If the counterparty sends a cancellation request, CBL will receive the request after the settlement cycle and CBL has up until the start of the next cycle to forward the cancellation request.

New issues settlement

Transactions in new issues are settled on the day on which distribution occurs in Copenhagen. For confirmation times, please refer to Settlement times.