The new order implies halving the exchange commission rate (from 0,002% to 0,001% of the transaction’s volume), charged from each participant, for swap transactions carried out by a participant in trades in the Unified Trading Session of inter-bank currency exchanges (UTS) if his daily volume of swap transactions exceeds the threshold value of 100 Mln US dollars.
According to the MICEX CEO Alexander Potemkin, the new measure will promote leading participants’ interest in swap transactions in the exchange currency market. The new order of charging commission for swap transactions is introduced for 3 months. Then the MICEX will analyze the effectiveness of the new measure and decide whether to prolong it.
A currency swap transaction, having the form of two conversion transactions, is economically analogous to an inter-bank credit. Commercial banks use currency swap transactions to manage balances in correspondent accounts in rubles and foreign currency. Besides, commercial banks use them to postpone currency positions for later settlement dates.
Overnight currency swap transactions, which have been concluded in the MICEX trading system since 2001, are a popular instrument on the currency market. At present (in the 1st quarter of 2005), the daily average turnover of currency swap transactions in the MICEX SELT amounts to 934 Mln dollars.
