- Omar Radwan: A key step for developing the infrastructure of financial market and applying the highest international standards
- Yasser Zaazaa: The Egyptian Exchange is a key partner and the memorandum sets a complete mechanism for real-time connection and risk reduction
The Egyptian Exchange (EGX) signed a joint strategic memorandum of understanding with the Egyptian Central Securities Depository Company (ECSD) aiming to create a comprehensive regulatory and technical plan enhancing efficiency and competitiveness of the government securities market (government debt instruments), boosting levels of safety and transparency in trading, registration, and settlement process according to the highest international practices.
Mr. Omar Radwan, EGX Executive Chairman, and Mr. Yasser Zaazaa, ECSD Chief Executive Officer and Managing Director, signed the memorandum of understanding in the attendance of leaders and officials from both sides.
From his side, Omar Radwan emphasized that signing this memorandum represents an important step in the process of developing the governmental debt and fixed income instruments in Egypt, especially since the shared goal is providing an investment environment aligning with the global standards regarding speed and efficiency of settlement, reducing operational risks, and increasing technical flexibility and readiness.
Yasser Zaazaa stated that signing this protocol highlights commitment of both sides to apply IOSCO standards for financial markets infrastructure. This cooperation is a real reflection of integration with EGX being a key partner.
This step comes in response of the strategic importance of developing the infrastructure of Egyptian financial market, in alignment with both parties commitment to adopt and apply “Principals of capital markets infrastructures” issued by the International Organization of Securities Commissions (IOSCO), ensuring alignment of the operational environment with the international standards aiming at reducing systemic risks and facilitating investment flows.
The memorandum of understanding sets a comprehensive regulatory framework defining mechanisms of mutual coordination. The main areas of cooperation include the following:
- Allowing trading of government debt instruments: through instant digital notification and coordination mechanism processing transactions of deposit and central registration of new government debt instrument issuances and their increases in the primary market via the Central bank of Egypt (CBE), which act as an agent on behalf of Ministry of finance, ensuring full readiness for trading in the secondary market once they appear on EGX screens
- Real time linking of investors’ database: by direct technical connection between both sides.
- Speeding-up the trading and settlement cycle: by sending executed transaction data in real time, ensuring business continuity and smooth, fully secure transaction settlement.
- Governance of cancellation and ownership transfer procedures: setting accurate framework for procedures with critical timing for handling cancellations and organizing mechanisms of transferring balances between codes of the same client.
Upon this cooperation, both sides will form work teams and specialized departments to regularly and continuously follow-up all stages of implementation and development of work mechanisms, supporting stability of national economy and its growth.
