Comprehensive Securities Operations

Agenda Program
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Prague, NH Hotel Prague
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The objectives of the course are for the delegates to:

Explain the trading motivations and the operational tasks relating to a variety of securities transaction types
Identify the processing risks and the essential controls (both internal and external) relating to such transaction types
Explain why securities collateral is given and taken relating to OTC derivative trades, how such collateral movements must be managed operationally, whether such collateral may be legally reused, and the treatment of corporate actions
Illustrate how to determine correct entitlement to corporate action events, and how different transaction types impact entitlement calculation
Describe the purpose of regulatory requirements that are being introduced, and how the operational responsibilities of affected organisations will be impacted.
Aims of the Course:
The training course is designed to develop to the fullest extent the understanding of Financial Services professionals that are seeking to increase their all-round knowledge of securities operations and securities processing.

The focus of the course is to convey the operational impacts, processing risks and controls relating to:
  • trades in commonly traded transaction types (including buy/sell, repo/reverse, securities lending/borrowing), plus
  • the giving/taking of securities collateral relating to trades in OTC derivatives
  • a range of income and corporate action events, plus
  • the introduction of regulatory measures pertaining to securities operations tasks
to enable participants to gain a complete and all-round understanding of a number of critically important securities processes and the inter-connectivity between such processes.

Each topic will be expanded and explained to the delegates in a structured manner (via linked building blocks), developing their knowledge through diagrams, ‘live’ drawings and on-the-spot explanations. Active participation of the delegates will be encouraged, and exercises will be introduced at frequent and appropriate points.

Program of the seminar: Comprehensive Securities Operations

The seminar timetable follows Central European Time (CET).

09.00 - 09.15 Welcome and Introduction

  • Programme Content: Overview
  • Delegate Introductions
  • Trainer Introductions

09.15 - 12.30

1. Essential Concepts & Terminology

  • Definition of 'Securities'
  • Date Concepts on Trades
  • Positions and Position Types
  • CSDs and Custodians

2. Pre-Trading: Static Data

  • Securities Static Data
  • Counterparty Static Data

3. The Securities Trade Lifecycle

  • Overview
  • Orders
  • Trade Execution
    • Exchange Trading vs OTC
    • Risks of OTC Trading
  • Trade Capture (Front Office)
    • Trade Components
    • The Traders' Perspective
    • Trading System Limitations
  • Trade Capture (Operations)
    • Impact on Books & Records
    • The Operations' Perspective
  • Trade Enrichment
    • Components Requiring Enrichment
  • Trade Agreement
    • Confirmation versus Affirmation
    • Trade Agreement Methods
  • Settlement Instructions
    • DvP versus FoP
    • Settlement Instruction Methods
  • Settlement Instruction Statuses
    • Status Types
    • Essential Pre-Settlement Actions
  • Failed Settlement
    • Overview of Implications

12.30 - 13.30 Lunch

13.30 - 17.00

3. The Securities Trade Lifecycle (continued)

  • Trade Settlement
    • Types of Settlement
  • Updating Books & Records
    • Settlement Date Entries

4. Securities Bookkeeping

  • Definition & Purpose
  • Importance of Accurate Books & Records
  • Double Entry Bookkeeping
  • When Entries Must Be Passed: Trades, Settlements
  • Application in Different Transaction Types

5. Securities Reconciliation

  • Purpose and Importance
    • Types, Frequency & Methods
    • What Reconciliation Enables

6. Securities Financing - Repo

  • Securities Financing: Introduction

09.00 - 12.30

6. Securities Financing - Repo (continued)

  • Cash-Based Repo: Introduction
    • Term versus Open Repo
    • Settlement Cycle
    • General Collateral (and Special Collateral)
    • Haircut and Initial Margin
    • Trade Confirmation
    • Settlement Method
    • Updating Books & Records
    • Revaluation of Collateral
    • Exposure Calculation
    • Making & Receiving Margin Calls
    • Ownership of Securities Collateral
    • Holding Securities Collateral
    • Reuse of Securities Collateral
    • Return of 'Equivalent' Assets
    • Collateral Substitution
    • Income Events

12.30 - 13.30 Lunch

13.30 - 17.30

6. Securities Financing - Repo (continued)

  • The Repo Trade Lifecycle
    • Introduction
    • Pre-Trading
    • Trade Execution
    • Pre-Settlement
    • Settlement of Opening Leg
    • Throughout Lifetime of Trade
    • Settlement of Closing Leg

6. Securities Lending & Borrowing

  • Securities Lending
  • Securities Borrowing
    • Collateral in Securities Lending & Borrowing
    • Settlement Methods
    • Exposures and Margin Calls
    • Securities Collateral Substitution
    • Recall of Lent Securities
    • Return of Borrowed Securities

7. Securities Financing Transaction Regulation SFTR Purpose

  • The SFTR Requirement
  • Parties Subject to SFTR
  • Deadline for SFTR Compliance

8. Securities Collateral relating to OTC Derivatives

  • OTC Derivatives: Overview
  • Why Collateral is Given/Taken
  • Exposures and Margin Calls
  • Market Value versus Collateral Value
  • Settlement Method
  • Holding Securities Collateral
  • Beneficial versus Legal Ownership
  • Reuse of Securities Collateral
  • Securities Position Reconciliation
  • Return of Securities Collateral

9. Central Securities Depository Regulation

  • CSDR Purpose
  • The CSDR Requirement
  • Parties Subject to CSDR
  • Deadline for CSDR Compliance

09.00 - 12.30

10. Corporate Actions

  • Fundamental Concepts
    • Definition of Corporate Actions
    • Impacted Parties
    • Purposes of Corporate Actions
    • Initiation of Corporate Actions
    • Ultimate Impact
    • Responsibilities of a Corporate Actions Department
    • Major Risks to Financial Institutions
  • Corporate Action Lifecycles: Overview
    • Mandatory, Optional, Voluntary
  • Event Type Characteristics & Impacts
    • Cash Dividends
    • Currency Option Dividends
    • Dividend Reinvestment Plans
    • Coupon Payments (Fixed-Rate, Floating Rate)
    • Bonus Issues
    • Stock Splits, Reverse Splits
    • Odd-Lot Offers
    • Bond Conversion
    • Final Maturities
    • Redemptions: Partial, Early, Voluntary
    • Rights Issues

12.30 - 13.30 Lunch

13.30 - 17.30

10. Corporate Actions (continued)

  • The Generic (Mandatory Event) Lifecycle: Overview
    • Declaration of Event Terms
    • Capturing Event Terms
    • Ascertaining Entitlement
    • Informing Relevant Parties
    • Calculating Resultant Entitlement
    • Updating Books & Records #1
    • Receiving & Crediting Resultant Entitlements
    • Updating Books & Records #2
  • Tax on Income Events: Overview
    • Definition of Withholding Tax
    • Treaty, Non-Treaty and Exempt Rates
    • Ensuring Correct Tax Rates are Applied
    • Over-Taxation
  • Optional & Voluntary Event Lifecycles: Overview
    • Definition of Mandatory with Options Events
    • Definition of Voluntary Events
    • Differences vs Mandatory Event Lifecycle

Training catalogue in PDF
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