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FEDERATION OF EURO-ASIAN STOCK EXCHANGES SEMI ANNUAL REPORT OCTOBER 2005
TAKASBANK-ISE SETTLEMENT AND CUSTODY BANK, INC.
Emin Catana
President and CEO
TAKASBANK IN GENERAL
Takasbank (ISE Settlement and Custody
Bank Inc) is incorporated as a non-deposit
taking banking institution and is authorized
by the Capital Markets Board of Turkey to
function as: the Central Securities Depository
of Turkey, the Clearing and Settlement
Institution for ISE markets, the Clearing
House for the Turkish Derivatives Exchange,
the National Numbering Agency of Turkey,
the Custodian for the Mutual Funds and
Pension Funds incorporated in Turkey.
Takasbank is owned by the ISE (26%) and
by the members of the ISE (20 banks and 70
brokerage houses with 40% and 34% stake
in the share capital, respectively).
Participants of Takasbank are the members
of the Istanbul Stock Exchange, clearing
members of the Turkish Derivatives
Exchange, institutional investors and issuers.
Services provided by Takasbank includes
safekeeping of physical securities, custody
and transfers of securities in book-entry
form, the execution of corporate actions, web
based monitoring service for investor subaccounts,
central clearing and settlement for
the ISE organized market (based on
multilateral netting), real time gross DvP
“member to member” settlement, settlement
and custody for foreign securities, cash
settlement and transfer facilities (domestic
and cross-border), Takasbank Money
Market, securities lending and borrowing,
cash credits, clearing house services for the
Turkish Derivatives Exchange and allocation
of ISIN for securities issued in Turkey.
Takasbank is an active member of
international organizations such as ANNA,
ISSA and is also member and user of the
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In 2005, Takasbank has become the
clearing and settlement center for all
transactions in spot/derivatives markets of
the organized markets in Turkey.
SWIFT communications network.
Currently equity investors’ holdings are
recorded in the sub-accounts of the
participants at Takasbank. Dematerialization
of securities is planned to be accomplished
by the 4th quarter of 2005. The Central
Registry Institution that is already set up with
65% shareholdership of Takasbank, will be
responsible for holding the register of the
dematerialized securities in Turkey.
On February 4th, 2005, the Turkish
Derivatives Exchange (TurkDEX)
commenced its operations with a variety of
contracts including commodities and
financial futures. Takasbank is appointed
and authorized as the Clearing House for
TurkDEX. Thus, Takasbank has become the
clearing and settlement center for all
transactions in spot/derivatives markets of
the organized markets in Turkey.
TAKASBANK AS THE CLEARING
HOUSE FOR TURKDEX
Takasbank acts as a buyer to every seller
and a seller to every buyer in each trade
executed at TurkDEX. In accordance with the
regulations, Takasbank guarantees the
derivatives market liquidity and safety with
the deposited margins and the Guarantee
Fund resources. Takasbank is the guarantor
for TurkDEX trades with a limited liability. This
liability is underlined in the 78-79th article of
TurkDEX regulations.
Takasbank’s main functions regarding with
the derivatives market and the Clearing
House Operations are as follows:
• Approval of clearing members.
• Central counterparty for TurkDEX trades.
• Limited guarantee with margins and
Guarantee Fund.
• Determination of collateral types and
operational procedures.
• Keeping position and collateral data on
either member or account basis.
• Mark to market daily.
• Monitoring collaterals and composition
check.
• Settlement of daily profit/loss.
• Announcement and monitoring of margin
calls (if any)
• Application of default process (if any)
• Liquidation of collaterals in case of default.
• Position/collateral transfers between
accounts.
• Corporate actions of collaterals deposited
against derivatives as margin.
• Management of the Guarantee Fund.
• Interest payment for cash margins and
the Guarantee Fund cash part.
• Training of clearing members.
The future functions that are under
development are:
• Clearing by T+1 (instead of T+0)
• Integration with the dematerialized system
(TurkDEX-Takasbank-Central Registry
Institution)
• Give-up (for the clearing members)
• Physical delivery feature for certain types
of contracts
• Analysis and development of options
contracts
Please see the May 2005 Edition of the FEAS
Semi Annual Report for detailed information
on clearing house functions of Takasbank for
TurkDEX.