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The President of the Thailand Securities Depository Co., Ltd , Mrs. Nongram Wongwanich, said that as the Ministry of Finance has appointed the TSD to be the center of all securities depository and clearing and settlement activities for debt instruments, the TSD is becoming the only place where a complete set of services can be offered for the equity, bond and derivatives markets. The TSD expects its preparation of its One-Stop Service Center to be complete by the end of 2005.
She said, “The TSD is collaborating with all relevant organizations, such as the Bank of Thailand, Securities and Exchange Commission, and the Thai Bond Dealing Centre, to develop the links necessary for the project to achieve its planned goal of becoming a one-stop center for all the markets. In the meantime, the TSD is encouraging all capital market participants to gain a better understanding about what we are trying to accomplish”.
The responsibilities for the depository, as well as clearing and settlement of both public and private bonds, will all be combined in one place, whereas currently the services are separated: at present, the Bank of Thailand is responsible for depository, clearing, and registry services for government and state-owned enterprise bonds, while TSD offers depository and registry services for a portion of private bonds.
Mrs. Nongram went on to add that “the benefits of combining these activities will include increases in trading volume as well as in liquidity in the bond market, because the combined service center will facilitate all transactions conducted in the secondary bond market. The transfer and receipt of all debt instruments will be conducted in a more timely fashion because we have eliminated the trouble of getting in touch with several offices, as is now the case”.
When the TSD is solely charged with the depository, clearing and settlement of the debt instruments, the overall cost within the industry will be automatically reduced due to the elimination of all duplicated operational and system development costs for both the public and private sectors. Furthermore, this will help prompt the industry to develop future links with overseas markets to trade Asia Bonds and other future transactions.
