1. Recent Developments in Securities Settlement Systems: Challenges for Emerging Markets
Global Payments Week 2008
Vienna, Austria
September 9th-12th
Mario Guadamillas
The World Bank

2. Challenges for Emerging Markets (from Regional Initiatives and FSAPs)
Legal framework (more complex in a global environment)
Protection of custody arrangements
Risks policies and procedures (beyond DvP model)
Operational issues (STP, Resilience and BCPs)
Governance (more complex in a global environment)
Lack of transparency (procedures/risks)
Access (sometimes to the payment system)
Lack of integration between payments and securities settlement systems
Regulation and oversight (lack of effective cooperation) 2

3. Findings from the Global Survey Data for all countries surveyed
Findings from the Global Survey Data for all countries surveyed. Detail by level of income and Region in the detailed publication available in
Legal and Regulatory Framework
A specific public sector agency regulates securities markets
Securities market law applies to all securities traded in the country
Securities market law applies to securities issued by private firms only
Countries # %
Worldwide totals (142 countries)
110
77% 73
51% 48
34%
Source: 2008 World Bank Global Survey on Payment and Securities Settlement Systems 3

4. Beneficial owners are identified at the individual level in the CSD
Findings from the Global Survey
Participants and Custody Arrangements
Only commercial banks are direct participants in the CSD (for central bank operated)/Only broker-dealers are direct participants in the CSD (for privately operated)
Beneficial owners are identified at the individual level in the CSD
Beneficial owners not identified at the individual level in CSD, but direct participants must segregate
Central Bank-operated systems # %
Worldwide totals (61 systems) 25
41% 22
36% 32
52%
Private Sector operated systems
Worldwide totals (87 systems) 20
23% 50
57%
37%
Source: 2008 World Bank Global Survey on Payment and Securities Settlement Systems 4

5. Findings from the Global Survey
Securities Depositories
Dematerialization or immobilization of securities in depositories largely accomplished
There is a single securities depository for all types of securities
Two or more depositories, each handling specific types of securities
Two or more depositories, each handling all types of securities
Countries # %
Worldwide totals (142 countries) 94
66% 50
35% 56
39% 9 6%
Source: 2008 World Bank Global Survey on Payment and Securities Settlement Systems 5

6. CSD has a real-time interface with the RTGS
Findings from the Global Survey
Main Settlement Features
Rolling settlement cycle of T+3 or shorter is used for all securities trades
CSD has a real-time interface with the RTGS
Model 1 DVP is used
Model 2 DVP is used
Model 3 DVP is used
Guarantee fund or other mechanism ensures settlement in case of default
Central Bank-operated systems # %
Worldwide totals (61 systems) 36
59% 37
61% 5 8% 7
11% 8
13%
Private Sector operated systems
Worldwide totals (87 systems) 77
89% 43
49% 47
54% 30
34% 27
31% 41
47%
Source: 2008 World Bank Global Survey on Payment and Securities Settlement Systems 6

7. Findings from the Global Survey
Regulation and Oversight of Stock Exchanges and CSDs
Securities regulator is empowered to license and supervise all stock exchanges
Securities regulator is empowered to license and supervise all CSDs
Securities regulator shares responsibility with the central bank for SSS oversight
Exchanges have the status of SRO
Private CSDs have the status of SROs
Countries # %
Worldwide totals (142 systems)
109
77% 88
62% 64
45% 43
30% 30
21%
Source: 2008 World Bank Global Survey on Payment and Securities Settlement Systems 7

8. Findings from the Global Survey
Resilience and Business Continuity
Routine procedures are in place for periodical data back-ups
Data storage media kept in sites other than main processing site
Back-up servers have been deployed at the main processing site
A fully equipped alternate processing site exists
Operator has documented a formal BCP - Business Continuity Plan
BCP includes procedures for information dissemination and for crisis management
Business continuity arrangements are regularly tested
Central Bank-operated systems # %
Worldwide totals (61 systems) 56
92% 51
84% 43
70% 36
59% 42
69% 41
67% 40
66%
Private Sector operated systems
Worldwide totals (87 systems) 79
91% 69
79% 59
68% 64
74%
64% 58
Source: 2008 World Bank Global Survey on Payment and Securities Settlement Systems 8

9. Payment Systems Development Group Latin America and The Caribbean
Thank you
Mario Guadamillas
Payment Systems Development Group
Latin America and The Caribbean
The World Bank 9