Securities and settlement systems
What is GSSS system?
It is a unified, integrated, state of the art securities settlement system that provides safe custody and instant settlement for both Government and corporate securities.The GSSS system carries out operations with the securities issued by the Ministry of Finance, National Bank of Georgia, international financial institutions and corporate issuers.
These operations include:
- automatic settlement of securities issuance redemption
- coupon and dividend payment transactions
- securities electronic registry
- repo operations
- financial collateral management and execution operations.
Secure, Fast and Efficient Settlement
The GSSS system is closely integrated with the Real Time Gross Settlement (RTGS) system, which enables securities transactions and related cash payments to be executed simultaneously, based on DvP principle, in central bank money, which significantly reduces the risk of settlement.
The GSSS system has settlement optimization tools such as net settlement, partial settlement, and auto-collateralization mechanism which makes securities settlement and liquidity management much more efficient.
One space for all securities
The GSSS system is a single, integrated space for the issuance, settlement and safekeeping of both public and corporate securities, including stocks.
All key players in the financial market: the National Bank, the Central Securities Depository of Georgia, commercial banks and brokers are participants of the GSSS system. The system is integrated with Bloomberg and future stock exchange trading platforms, allowing market participants to automatically transfer securities traded in these trading systems to GSSS for final settlement. As a result of this integration, a securities investor can easily acquire and hold all types of securities, in both primary and secondary markets, using one securities account opened in the GSSS system.
NBG's monetary operations automation
Another important function of GSSS system is NBG's monetary operations automation. The system allows banks to get liquidity from the National Bank by pledging securities from their portfolios conveniently. Integration with the Bloomberg trading platform allows NBG to automate refinancing and securities trading operations, which reduces operational risks and increases effectiveness of monetary operations.
Predominance of GSSS System
The GSSS system lays down the foundations for a single infrastructure for securities custody and settlement, which in turn promotes to a greater integration of the financial market. As a result:
- It is much safer and easier for an investor to buy securities;
- The costs of issuance, holding and settlement of securities are significantly reduced;
- From a Commercial bank perspective, mobilization and management of financial collateral is simplified;
- Payment is made through the accounts opened at the National Bank, which reduces the risk of settlement and increases financial stability.
System Management
The owner and operator of the Georgian Securities Settlement System (GSSS) is the National Bank of Georgia. The system is built on the modern web based technologies. Information security in the system is ensured by electronic tokens and digital signature.
GSSS system's operating hours are 9:40 am to 6:40 pm. The system does not operate on weekends and on holidays specified by Georgian legislation.
GSSS System Oversite
The GSSS system oversite is carried out using the National Bank of Georgia Payment Systems Oversite Rule and the Financial Market Infrastructure (PMFI) Principles. For this purpose, the National Bank of Georgia periodically conducts self-assessment of the GSSS system. General overview / results of the self-assessment will be published on the website of the National Bank of Georgia.
