Key Criteria

Asset Commitment, Liquidity and Counterparty Risks:

Factors influencing risk include: securities and cash settlement systems, securities and cash delivery times, access to credit facilities, access to stock lending facilities, nominee and registration arrangements, settlement cycles, participation criteria, surveillance arrangements, capacity in which CSD operates, settlement assurance arrangements and the existence of delivery versus payment arrangements.

Financial and Operational Risks:

Factors influencing risk include: procedures and controls surrounding the clearing, settlement, safekeeping and asset servicing functions, financial condition of the CSD, ownership arrangements, ability to replenish funds through income in fee review, insurance arrangements, disaster recovery and business continuity arrangements and liability to participants for operational errors.

Asset Servicing Risks:

Factors influencing risk include: corporate action and proxy arrangements, centralised information source, obligations on issuers to provide information to the CSDs and CSDs' liability for the accuracy, completeness and timeliness of corporate action information and the processing of corporate action instructions.