The Depository Trust & Clearing Corporation (DTCC), the New York-based world's largest depository, signed separate agreements with India's two depositories National Securities Depository (NSDL) and Central Depository Services (CDSL) for information sharing, exchange of ideas and data exchange on clearing and settlement. | |
| The deals signed by DTCC, which provides custody and asset servicing to 2.8 million securities issues (valued at $36 trillion) from the United States and 100 other countries and territories, are the first of this sort in India. |
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| The pacts also gain importance in view of the recent government regulations allowing foreign players to pick up to 26 per cent in stock market infrastructure companies such as domestic depositories. The financial sector, including the stock exchanges and brokerages, is attracting huge foreign interest for a strategic investment. |
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| Following the deals, the executives of the two depositories would meet on regular basis to increase mutual understanding and exchange market updates, improvement opportunities and information on business operating models, separate releases by NSDL and CDSL said on Monday. |
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| "India is one of the fastest growing economy, and CDSL and NSDL are a major part of the securities infrastructure in the country. These agreements will give us a structure to exchange ideas, share insights and develop co-ordinated ways of working in a global trading environment," Donald F Donahue, DTCC chairman-elect and chief executive officer was quoted as saying. |
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| NSDL CMD C B Bhave said, "We believe that forming closer ties with DTCC will work towards the prosperity of our respective financial markets and build understanding and co-operation. The mutual exchange of information on our business operating models and service offerings will bring enormous benefits to our customers and markets." |
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| Vijay Raut, CDSL managing director and CEO said the agreement with DTCC was an extension of the good relations CDSL shared with them. "I see it as an initial formal handshake, the beginning of a long and mutually beneficial business relationship," he added. |
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| He also said that although DTCC and CDSL had different legislative frameworks and settlement systems, it would be beneficial for both the depositories to share their experiences to reduce risks and enhance the efficiency of the systems. |
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| DTCC is a leading processor of mutual funds and insurance transactions, linking funds and carriers with their distribution networks. The total size of securities held by NSDL is valued at $863 billion. |
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