* ASX – Clearing House Electronic Sub-Register System (CHESS). –equities
Austraclear – used for all AUD denominated money market securities where wholesale debt instruments in Australia, such as Fixed Interest and Money market Securities, are held in safe custody allowing for trades in those securities to be settled electronically until their eventual maturity. To make use of the CSD, debt instruments must first be electronically lodged with SFE Austraclear. Use of a Real Time Gross Settlement (RTGS) Delivery versus Payment model (DvP) of settlement provides protection to all parties involved in the clearing and settlement of securities including commonwealth government bonds, short-term debt, semi-government and corporate bonds.
Dematerialisation is mandatory except for securities that are not CHESS – eligible (i.e. those incorporated outside Australia). CHESS Depository Interest (CDIs), securities that are traded outside of Australia, can be dematerialised in a manner similar to US ADR’s whereby CHESS immobilise the certificates within its nominee company and provides electronic settlement.
Corporate bonds are immobilised and government debt is dematerialised.
CHESS is used for ASX and NSX listed equities.
RTGS and Austraclear provide real time payments for wholesale market. SFE Austraclear offers the capability to settle electronic cash transfers via the RBA Real Time Gross Settlement (RTGS) system. The Electronic Cash Transfers (ECTs) are two-sided and can be bank-to-corporate (B2C), corporate-to-corporate (C2C), and bank-to-bank (B2B). Competitively priced, the SFE Austraclear solution offers a reliable, secure, and independent service to transfer funds on a RTGS basis. Significant Straight Through Processing (STP) opportunities are also available through the use of ECTs.
Upon receipt of an Electronic Cash Transfer (ECT) instruction, the request is electronically matched with the counterparty and sent to the RTGS queue for settlement. End of day cheque clearance between Australasian banks for retail payments/cheques is also provided.
Internationally, CLS Bank International provides payments in AUD as part of a unique real-time process enabling simultaneous FX settlement for fifteen currencies across the globe. The settlement risk in cross currency payment instruction settlement is eliminated as CLS Bank link the local central bank Real Time Gross Settlement (RTGS) systems during a five-hour window of their overlapping business hours. In this window, settlement instructions for a particular date are settled, funds are requested to be paid in and are then paid out by CLS Bank.
Yes, overdrafts are permitted in the market, however these need to be agreed with the local custodian.