Central Depository System

Group Members
Abdullah Mohsin Asim Ghafoor Bilal Ahmed Mahmood Ahmed Tahir Shahid Iqbal Pervaiz Iqbal

Agenda
Introduction History Central Depository System Benefits Of CDS Elements Of CDS Account Structure Operations

Introduction
started operations in September 1997 CDC is the sole entity handling the electronic(paperless) settlement of transactions carried out at all three stock exchanges of the country. approximately 99% of the market settlement is in book entry form

Provide Services
provides depository services to a wide range of Capital Market participants which includes Brokers Asset Management Companies Banks general retail investors

Aim Of Central Depository Company

The aim of CDC is to operate as a central securities depository on behalf of the financial services industry to contribute to the country's ability to support an effective capital market system . CDC is regulated by the SECP. CDC has branches in Karachi, Lahore and Islamabad.

History
The IBM consortium proposed a comprehensive Master Implementation Plan (MIP) to the CDC Board after a detailed analysis of the following: National requirements Company and Banking laws Regulations & Procedures Financial and organizational aspects of the project

Central Deposit System (CDS)

Main function to operate CDS Guidance well defined by SECP Installed by IBM No Physically movement of securities

Benefits of CDS
Reduced workload and manpower requirements. No stamp duty on transfers in CDS. No risk of damaged, lost, forged or duplicate certificates. Paperless environment. Secure custody of securities. Substantial reduction of paperwork during book closure.

Elements of Central Depository System

There are three elements of CDS
Account Holders Issuers / Registrars Eligible Pledges

Account holders
Account Holders are divided into two categories: Account Holder Participant Both have direct access to CDS

Issuers / Registrars
issuers of capital whose securities are converted from physical to electronic book entry system eliminates the problem of fake/duplicate/lost/stolen share certificates

Eligible Pledges

Financial institutions that lend against securities have their account with CDS in the capacity of Eligible Pledges

Account Structure
Main Account House Account Sub-account (Client Account) Group Client Account Cash Account

Main Account
Each Account Holder in the system allocated a main account by virtue of being an Account Holder in the CDS. Any security coming in or moving out of an account holder's family of accounts will pass through this account.

House Account
Used for securities owned beneficially by Account Holders.

Sub-account (Client Account)

used for keeping securities belonging individually to each of the clients of an Account Holder. Account Holder may open and maintain any number of subaccounts he requires on behalf of his clients.

Group Client Account

This account is used for keeping securities which are beneficially owned by the Account Holder's client. The Account Holder will group all such clients in his/her Group account.

Cash Account
Each Account Holder in the system who opts to avail the Delivery vs. Payment (DVP) facility required to deposit relevant amount to be used for the settlement of DVP obligations.

OPERATIONS