(MENAFN- Khaleej Times) The Abu Dhabi Securities Exchange, or ADX, announced that it is continuing the process of enhancing its delivery versus payment, or DvP, model, which it launched in May 2011, through applying a buyer cash compensation, or BCC, settlement procedure.
The new procedure, which will take effect this May, means that a buying investor will be paid cash compensation in the unlikely event that securities are unavailable for delivery to the buying investor on the settlement date.
With the implementation of the BCC, the ADX not only seeks to reinforce the currently-implemented DvP model, but also to keep in adherence with international standards for financial markets infrastructure, especially since efficient and safe securities clearing and settlement systems are a necessary condition to ensure the smooth functioning of payment systems and of the preservation of financial stability.
"To create true value through innovation in today's economic climate is a real challenge - for any organisation. We look forward to further collaborations with all of our stakeholders to drive the product development process forward," ADX chief executive officer Rashed Al Baloushi said.
"Applying this new procedure reflects the ADX's ongoing strategy to apply the best international practices in the fields of securities infrastructure. It will assist us in utilising the necessary measures to strengthen our overall frameworks, minimise operational risk, and streamline processes for effective day-to-day operations that will be vital as we continue to enhance services we provide to our stakeholders," he added.
The ADX will be conducting briefing sessions for its market participants in order to explain the many aspects of this upcoming procedure.
The ADX has 68 listed securities and a market capitalisation of Dh292 billion ($79.4 billion) as of September 30, 2012, and an investor base of 914,564 as of the end of 2012.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.