Azleema Ahmed Deputy Manager Capital Market Development Authority

Azleema Ahmed Deputy Manager Capital Market Development Authority (CMDA)

Maldives Securities Depository (MSD) o What is a MSD? n n MSD is the first Central Depository in Maldives It is an automated system which provides investors an efficient central clearing of securities for the securities traded on the Maldives Stock Exchange.

Maldives Securities Depository o Maldives Securities Depository (MSD) was incorporated on 14 th April, 2004 o MSD is housed within the CMDA o CDS rules is adopted by the Securities Act 2/2006

Maldives Securities Depository o Object – To speed up share trading and facilitate safe keeping of share o Services n n n Account registration Share deposit and withdrawal Share transfer for trading Safe keeping Account information to investor & companies

How does the MSD work? Investor Directly SHARE CERT Deposited CDS

How does the MSD work? Certificates CDS Shares credited

How does the MSD work? Investors Stock Exchange Transactions Shareholders List MSD Investors A/C Share transferred Contract Note

How does the MSD work? MSD Investor “A” A/C Investor “B” A/C

MSD uses Direct A/C method o Merits n n n Investors are more confident as securities are held under their name Easier to manage and minimise errors Direct transfer facility Easier to monitor the trading as first hand information on trading personnel Legally matters can be solved easily

Future Plans o Plan n To provide Indirect account method n To facilitate broker, custodian participation n To facilitate settlement and Clearing for the securities traded n To facilitate pledging of securities (lending and borrowing) n To facilitated debt and other types of securities

MSD Goal n Ultimate goal is to establish an efficient central depository system for clearing and settlement for the securities market in the Maldives n To established a Dematerialized Market

MSD uses Direct A/C method o Demerits n n Difficulty in A/C opening Less people in the depository Information is not often updated to depository Difficulty in operation and handling of A/C.

Maldives Securities Depository (MSD) n n n Thus we need to study and understand methods and procedures Learn best practices and knowledge of other developed Depositories and Clearing system so that we can develop and enhance the depository to achieve the ultimate goal. Corporation, assistance and expertise of sister depositories, institutions and member countries are very crucial. THANK YOU