Settlement services - Japanese debt securities
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 offered | Method employed | Start (local time) |
| Debt | ||
Immediate Release Flag available | Manual via telephone or fax | 14:00 SD-1 |
| Book-entry bonds and book-entry JGBs | ||
Immediate Release Flag available | PSMS or Manual via telephone | As soon as instructions are received by HSBC Japan (PSMS) 14:00 SD-1 (Manual) |
| Connectivity medium | Instruction format |
Xact Web Portal | Tick to enable the "Immediate Release" option. |
Xact via Swift and Xact File Transfer | Field :22F::STCO/CEDE/IREL |
Domestic allegement matching service
Where no pre-matching instruction has been sent to the market, CBL accepts allegements via its depository from domestic market counterparties, provided that the client’s account number at CBL is available and been asked by counterparties. It will then use these allegement messages to search for the best matching client instruction.
If no matching client instruction is found, the allegement is reported to the client 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 counterparty | Deadline | |
Clients delivering securities to, or receiving them from, the Japanese market must request their domestic counterparty to deliver the securities to or receive them from the CBL sub-account with HSBC Tokyo as follows: | Market deadline | |
- | Delivering Agent/Receiving Agent: HSBC Tokyo (BIC: HSBCJPJT) | |
- | Deliverer's Custodian/Receiver's Custodian: Clearstream Banking S.A. (BIC: CEDELULL) | |
- | Seller/Buyer: Ordering party's/beneficiary's account number in CBL | |
Procedures for DTC counterparties
Procedure for the DTC counterparty | Deadline |
Receipt in CBL | |
Clients can receive global bonds from participants in DTC on a free of payment basis. | Market deadline |
Delivery from CBL | |
Clients can deliver global bonds to participants in DTC on a free of payment basis. | Market deadline |
a. Mizuho Trust and Banking Company, New York (MHTNY) for CC 5409934; The Bank of Tokyo-Mitsubishi Trust Company, New York (BTMTC) for CC 8451818.
b. Mizuho Corporate Bank Ltd, Tokyo for CC 5409934; The Bank of Tokyo-Mitsubishi UFJ Ltd, Tokyo for CC 8451818.
Allowed countervalue difference
A maximum difference in countervalue of JPY 3,500 is allowed for matching and settlement of against payment transactions with domestic counterparties. In the event of a discrepancy within these limits, the receiving party’s cash amount shall generally prevail.
In addition, there is a market tolerance limit set by JASDEC at JPY 100. When pre-matching is conducted by PSMS, settlement amounts will be automatically adjusted up to JPY 100 and for that, the seller's amount is always prioritised.
Back-to-back processing
Back-to-back processing is available for transactions in all book-entry corporate and municipal bonds settling in JASDEC and government bonds settling in the Bank of Japan. If both the client 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, clients must ensure that their back-to-back transactions are formatted as follows:
| Connectivity medium | Pool ID format | Field(s) to be used |
Xact via Swift and Xact File Transfer | :POOL//16xa 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 ’//’.
Clients should also indicate their reference in the narrative field of their settlement instructions (:70E::SPRO// in Xact via Swift and Xact File Transfer) by including the text “SAME DAY TURNAROUND RELATED REF xxxxxxxx” on both the receipt and delivery legs of the back-to-back transactions.
Note: Deadlines for the receipt of valid instructions for back-to-back transactions remain unchanged (see Settlement times).
Management of failed instructions
Instructions in the domestic market that remain unmatched by the requested settlement date are reported to CBL.
Any instruction that reaches the depository after the deadline will be settled with the next possible value in the domestic market with no backvaluation.
Domestic instructions remain in suspense until they settle or until they are cancelled. CBL reserves the right to cancel an instruction with a domestic counterparty that has not settled by the fifth domestic business day after the day on which the instruction was released to the depository for settlement.
New issues settlement
The earliest transaction settlement in new issues will, when appropriate, take place on issuance date in the local market. For confirmation times, please refer to Settlement times.