English
The Romanian capital market urgently needs a central counterparty, as we are one of the few European markets that don't have such an entity, says Cristian Agalopol, the president of the Central Depository.
In his opinion, it would have been better to switch to a "T+2" settlement cycle (two days, down from three), once we had a central counterparty, which would take on the risk of trade failure.
According to Mr. Agalopol, the ability of the institutions of the stock market to manage risk is very important: "Demand depends heavily on how the stock market manages its risks, both in the trading area, as well as in the post-trading area". In this context, the president of the Central Depository considers that the institutions of the stock market must learn how to collaborate with the players: "It is important to know how to cooperate with the participants in the field to avoid getting caught by surprise by the European regulations and by their manner of implementation. I am concerned with the manner in which we, as a market, are trying to resolve some of the issues using the press, while it would be necessary for them to be resolved instead only through communication between the specialized institutions or just between the institutions and the participants on the stock market. We only need to go to the press when we have something clear to say".
Cristian Agalopol was referring to the recent communiqué of the Bucharest Stock Exchange in which the management of the Bucharest Stock Exchange considers that the switch to the
two-day settlement cycle ("T+2", instead of "T+3"), by October 6th, is the responsibility of the management of the Central Depository. The BSE announcement came after Ludwik Sobolewski, the CEO of the BSE, and Adriana Tănăsoiu, have announced together two major projects for the market which would be implemented simultaneously: the shortening of the settlement cycle and the separation of the trading and post-trading accounts, starting on October 6th.
Cristian Agalopol emphasized the fact that the sector is being flooded by projects which the authorities are trying to find solutions for, in order to get them implemented.
The Regulation concerning Central Depositories, approved at the level of the EU, which will come into effect on September 17th, also concerns Exchanges and central counterparties, Mr. Agalopol said. He added that the recommended course of action is for the BSE, the Central Depository and the central counterparties to cooperate for the implementation of this regulation.
One very important stipulation of the European regulation concerns the fact that "everything that means «buy in» and «sell out» in a trade conducted through the stock exchange must be included in the Code of the Exchange, and «buy in»s and «sell out»s conducted outside the Exchange must be transferred to the Depository or the central counterparties, and the regulators have the obligation to make sure that these regulations are complied with", according to the president of the Central Depository.
The main risks in carrying out the regulations concern the manner in which the investors and the customers can adapt their regulations and the manner in which they are interacting with our stock market, Cristian Agalopol further said, and he said that it was very important for the Romanian stock market to enter the list of emerging markets.
The institutions involved are trying to create a schedule for the implementation of all the projects of the capital market, Cristian Agalopol said.
The infrastructure of the capital market has to be changed, as a new software is needed at the Central Depository, Cristian Agalopol reiterated, and he stressed that every project in the market "runs into an infrastructure that can not accommodate all the projects within a delay that is comfortable for participants".
Euro
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Liră sterlină
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