A stable, well-functioning financial market for allA stable, well-functioning financial market for allEvaluation of securities settlement in Sweden in 2007
The financial markets have several important functions. They convert savings into investments, supply tools for risk management and offer payment services. Securities transactions are essential for all three functions. Securities acquisitions are a way of investing while pledging securities is a way of reducing credit exposure risks.
The banks and institutes that are members of RIX, the system for large payments, are only granted intraday credit if they have pledged securities to the Riksbank (the Swedish central bank). On the Swedish securities market, VPC as the central securities administrator plays a crucial role in management securities transactions after conclusion of business.
Considering the great significance of securities transactions, both the Riksbank and Finansinspektionen feel that it is important to evaluate how the entire management of securities transactions after conclusion of business functions on the Swedish market. Finansinspektionen and the Riksbank characterise VPC as an institution of significance to the financial system's stability.
This evaluation follows the recommendations and methods that have been developed by the Committee on Payment and Settlement Systems (CPSS) in co-operation with the Technical Committee of the International Organization of Securities Commissions (IOSCO).
