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CSDs and the challenges of financial integration and financial stability
Journal of Securities Operations & Custody,
9
(3),
225-235
(2017)
Abstract
Outside of the release of the Principle of Financial Market Infrastructures (PFMIs), the financial stability implications of a regional payments and settlements infrastructure does not appear to be actively discussed. This paper ventures to put the discussions on collaborative efforts of central securities depositories (CSDs) towards a more integrated market with an interconnected or interoperable settlement and payment infrastructure in the context of financial stability. Consequently, the paper brings the discussions on regional settlement infrastructure beyond standardisation of processes, message formats and items into a policy issue of financial stability and financial integration, with the intent that by having our attention geared towards the unintended consequences of a single market, we can mitigate the potential surprises it brings which can be systemic in its impact.
Keywords: central securities depositories, collaboration, financial integration, financial stability, systemic risk, trilemma
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Author's Biography
Theresa B. Ravalo is president and Chief Operating Officer of both the Philippine Depository and Trust Corp. (PDTC) and Philippine Securities Settlement Corp. (PSSC). PDTC is the country’s central securities depository (CSD) for the equities and fixed income securities markets while the PSSC provides the payments infrastructure for the fixed income and currency markets. Both entities are subsidiaries of the Philippine Dealing System Holdings Corporation (PDS). She brings with her extensive experience in risk management, banking and capital markets over the past three decades. Prior to joining PDS, she was vice president at Citibank handling the credit of the Republic and key conglomerates. She has been instrumental in developing the collateral management capability of the depository and led the development of the tracking system used in the fixed income market that now allows tax-exempt holders to trade in a single market with taxable holders. Among her current activities, she is focused on expanding PSSC’s capability to support the growth and evolution of the Renminbi in the local market. She represents the depository in the Asian Bond Market Forum, the Cross Border Settlement Infrastructure Forum and the Asia-Pacific CSD Group, among others.
