The Association of Global Custodians: 2006 - 2007 Questionnaire
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SCOPE, STRUCTURE, OWNERSHIP, CAPITAL, REGULATION AND AUDIT
The purpose of this section is to understand the ownership structure and financial strength of your institution, as well as the level of regulatory and operational supervision to which it is subject.

Scope, Structure, Ownership
 1 
Rule 17f-7, by reference to Rule 17f-4, requires that, for a depository to be eligible to hold securities of U.S. registered investment companies (such depositories hereinafter referred to as “Eligible Securities Depositories”), the depository must be a “system for the central handling of securities where all securities of any particular class or series of any issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of the securities.”

In particular, are all securities of a particular class or series of any issuer that are deposited in your institution treated as fungible, and can they be transferred or pledged by bookkeeping entry without physical delivery of the securities?
clear radio button selections

Yes
No  - then answer 1a
Other  - then answer 1a


1a. Please explain:



 2 
Rule 17f-7 also requires that an Eligible Securities Depository “acts as or operates a system for the central handling of securities or equivalent book-entries in the country where it is incorporated,” or “acts as or operates a transnational system for the central handling of securities or equivalent book-entries.”

Does your institution: (Choose all that apply.)


Act as or operate a system for the central handling of securities or equivalent book-entries in the country where it is incorporated?  - then answer 2b
Act as or operate a transnational system for the central handling of securities or equivalent book-entries?  - then answer 2b
Act in another capacity with respect to the handling of securities or equivalent book-entries?  - then answer 2a
Not applicable  - then answer 2a
Other  - then answer 2a


2a. Please explain:




2b. Please specify the types of securities for which you act as or operate a system for the central handling of securities or equivalent book-entries:



 3 
What type of legal entity is the institution? (Choose all that apply.)

Public Company
Private Company
Central Bank (or part thereof)
Stock Exchange (or part thereof)
Other  - then answer 3a


3a. If other, please explain:



 4 
Is the institution operated as a "for profit" or a "not for profit" organization? clear radio button selections

For profit
Not for profit
Other  - then answer 4a


4a. If other, please explain:



 5 
Please provide the names of the owners and their ownership interest percentages.

National Bank of Hungary(NBH)- 53,33%
Budapest Stock ExChange(BSE)- 46,67%



 6 
What is the date of establishment of the depository? (DD/MM/YY)

12 October 1993


 7 
What is the date that the depository's operations began? (DD/MM/YY)

12 October 1993


 8 
Under what regulation or statute is the depository established and governed?

Act CXX of 2001 on The Capital Market (Capital Market Act)

Act CXII of 1996 on Credit Institutions and Financial Enterprises (CIFE)
  - then answer 8a


8a. Is the regulation or statute electronically available? clear radio button selections
Yes  - then answer 8b
No


8b. If regulation or statute is electronically available, please supply web address or upload document.
Hungarian Capital Market Act



8c. If more than one link or document, please supply additional information here:
   



8d. If more than one link or document, please supply additional information here:
   



8e. If more than one link or document, please supply additional information here:
   



8f. If more than one link or document, please supply additional information here:
   



8g. Please provide details of the structure and composition of your Board together with their industry experience and responsibilities in governing the depository.

What are the qualifications to become a board member?

By law college degree or higher and professional experience are needed while criminal record or incompatibility of duties disqualify candidates.



8h. What are the election procedures?
Board members are elected at the general meeting subject to approval by the Hungarian Financial Supervisory Authority.



8i. What is maximum length of time they can serve as a board member?
Re-election is possible without limit.



8j. Who is responsible for regulating the board members?
Certain legislation, the company general meeting, and the Hungarian Financial Supervisory Authority are all in a sense responsible for regulating Board members.



8k. What is the extent of their voting powers?
To reach Board decisions.


 9 
Rule 17f-7 requires that an Eligible Securities Depository “is regulated by a foreign financial regulatory authority as defined under section 2(a)(50) of the Act”, with section 2(a)(50) establishing that “’foreign financial regulatory authority’ means any (A) foreign securities authority, (B) other governmental body or foreign equivalent of a self-regulatory organization empowered by a foreign government to administer or enforce its laws relating to the regulation of fiduciaries, trusts, commercial lending, insurance, trading in contracts of sale of a commodity for future delivery, or other instruments traded on or subject to the rules of a contract market, board of trade or foreign equivalent, or other financial activities, or (C) membership organization a function of which is to regulate the participation of its members in activities listed above.”

Who regulates the activities of the depository? (Choose all that apply.)


A governmental body or regulatory organization empowered to administer or enforce laws related to securities matters.
A governmental body or self-regulatory organization empowered to administer or enforce laws related to other financial activities.
A membership organization which regulates the participation of its members in securities matters or other financial activities.
Other.  - then answer 9a


9a. Please explain:



 10 
Please provide the name of the regulatory authority(ies) identified in question 9:

1. Hungarian Financial Supervisory Authority
2. National Bank of Hungary


 11 
Rule 17f-7 requires that an Eligible Securities Depository “is subject to periodic examination by regulatory authorities or independent accountants.”

Is the depository subject to periodic examination by: (Choose all that apply.)


Regulatory authorities?
Independent accountants?
Other.  - then answer 11a


11a. Please explain:



 12 
What enforcement actions are available to the regulatory authority(ies) for breach of applicable statute or regulatory requirements? (Choose all that apply.)

Name of Authority (1):


Hungarian Financial Supervisory Authority
  - then answer 12a


12a.
Fines.
Restrictions on depository activities.
Suspension of depository activities.
Termination of depository activities.
Other.  - then answer 12b


12b. Please explain:




12c. Name of Authority (2):
National Bank of Hungary
  - then answer 12d


12d.
Fines.
Restrictions on depository activities.
Suspension of depository activities.
Termination of depository activities.
Other.  - then answer 12e


12e. Please explain:
May initiate the imposing of a penalty at the Hungarian Financial Supervisory Authority.
May revoke the license issued for the auxiliary financial activity.


 13 
Has there been any use of such enforcement actions in the last three years? clear radio button selections

Yes  - then answer 13a
No
Other  - then answer 13a


13a. If yes or other, please explain:
KELER was fined USD 5000,00 by the Hungarian Financial Supervisory Authority in 2006 for non-compliance with IT security regulations.





Capital
 14 
Are annual financial statements publicly disclosed? clear radio button selections

Yes  - then answer 14a
No  - then answer 14c
Other  - then answer 14h


14a. If yes, the AGC requests a copy of the institution's annual report. Is the annual report available electronically? clear radio button selections
Yes  - then answer 14b
No. (If no, please send a copy of the annual report to the Washington office of Baker & McKenzie, 815 Connecticut Ave, NW, Washington, DC 20006, Attn: Brian C. Herbert)


14b. If yes, please upload the document here or insert web link:
annual report 2005



14f. If more than one document for 14b, please upload the additional document here or insert web link:
   



14g. If more than one document for 14b, please upload the document here or insert web link:
   



14c. If no, and annual report and/or financial statements are not disclosed, please state your share capital, reserves, and retained earnings (or equivalents as determined under local accounting standards).

Share Capital:


  - then answer 14d


14d. Reserves:

  - then answer 14e


14e. Retained Earnings:




14h. If other, please explain:






Audit

With respect to the depository's financial audit
 15 
Do internal auditors perform a financial audit? (Choose all that apply.)

Yes  - then answer 15a
No  ›› take you to 16
Other  - then answer 15g


15a. If Yes, which department in your depository handles the financial audit?
Internal Audit
  - then answer 15b


15b. How frequently does the financial audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 15d
Annually  - then answer 15d
Less than Annually  - then answer 15c
Other. Please explain in 15c.  - then answer 15c


15c. If less than annually or other, please explain:




15d. Are results of the financial audit publicly available? clear radio button selections
Yes  - then answer 15e
No  - then answer 15e


15e. Please select the statement that most accurately characterizes the results of the last financial audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 15f
Material exceptions found.  - then answer 15f
Other  - then answer 15f


15f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:




15g. If other, please explain:




15h. Please list the date of your last financial audit performed by internal auditors and the period that the audit covered:



 16 
Do independent external auditors perform a financial audit? (Choose all that apply.)

Yes  - then answer 16a
No  ›› take you to 17
Other  - then answer 16h


16a. If yes, what is the name of the accountant/accounting firm that handles the financial audit?
Regarding the year 2005 it was KPMG International.
However, in 2006 the general meeting approved Deloitte Ltd. as the new independent auditor.
  - then answer 16b


16b. How frequently does the financial audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 16d
Annually  - then answer 16d
Less than Annually  - then answer 16c
Other. Please explain in 16g.  - then answer 16g


16c. If less than annually, please explain:




16d. Are results of the financial audit publicly available? clear radio button selections
Yes  - then answer 16e
No  - then answer 16e
Other  - then answer 16i


16e. Please select the statement that most accurately characterizes the results of the last financial audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 16f
Material exceptions found.  - then answer 16f
Other  - then answer 16f


16f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:




16i. If other, please explain:




16g. If other, please explain:




16h. If other, please explain:




16j. Please list the date of your last financial audit performed by independent external auditors and the period that the audit covered:
Audit ended May 3, 2006 covering year 2005.


 17 
Do regulatory authorities perform a financial audit? (Choose all that apply.)

Yes  - then answer 17a
No  ›› take you to 18
Other  - then answer 17h


17a. If Yes, what is the name of the regulatory authority that handles the financial audit?

  - then answer 17b


17b. How frequently does the financial audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 17d
Annually  - then answer 17d
Less than Annually  - then answer 17c
Other. Please explain in 17g.  - then answer 17g


17c. If less than annually, please explain:




17d. Are results of the financial audit publicly available? clear radio button selections
Yes  - then answer 17e
No  - then answer 17e


17e. Please select the statement that most accurately characterizes the results of the last financial audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 17f
Material exceptions found.  - then answer 17f
Other  - then answer 17f


17f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:




17g. If other, please explain:




17h. If other, please explain:




17i. Please list the date of your last financial audit performed by regulatory authorities and the period that the audit covered:



 18 
Do any other auditors perform a financial audit? (Choose all that apply.)

Yes  - then answer 18a
No  ›› take you to 19
Other  - then answer 18h


18a. If Yes, please explain and identify by name?

  - then answer 18b


18b. How frequently does the financial audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 18d
Annually  - then answer 18d
Less than Annually  - then answer 18c
Other. Please explain in 18g.  - then answer 18g


18c. If less than annually, please explain:




18d. Are results of the financial audit publicly available? clear radio button selections
Yes  - then answer 18e
No  - then answer 18e


18e. Please select the statement that most accurately characterizes the results of the last financial audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 18f
Material exceptions found.  - then answer 18f
Other  - then answer 18f


18f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:




18g. If other, please explain:




18h. If other, please explain:




18i. Please list the date of your last financial audit performed by any other auditors and the period that the audit covered:






With respect to the depository's operational audit
 19 
Do internal auditors perform an operational audit? (Choose all that apply.)

Yes  - then answer 19a
No  ›› take you to 20
Other  - then answer 19g


19a. If Yes, which department in your depository handles the operational audit?
Internal Audit
  - then answer 19b


19b. How frequently does the operational audit occur? (Choose one.) clear radio button selections
Two or more times a year
Annually
Less than Annually  - then answer 19c
Other. Please explain in 19c.  - then answer 19c


19c. If less than annually or other, please explain:




19d. Are results of the operational audit publicly available? clear radio button selections
Yes  - then answer 19e
No  - then answer 19e


19e. Please select the statement that most accurately characterizes the results of the last operational audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 19f
Material exceptions found.  - then answer 19f
Other  - then answer 19f


19f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:
Discovered deficiencies are constantly being addressed based on the internal audit reports.



19g. If other, please explain:




19h. Please list the date of your last operational audit performed by internal auditors and the period that the audit covered:
Internal operational audit is performed on a continuous basis focusing on two or three business units at a given time.


 20 
Do independent external accountants perform an operational audit? (Choose all that apply.)

Yes  - then answer 20a
No  ›› take you to 21
Other  - then answer 20h


20a. If Yes, what is the name of the accountant/accounting firm that handles the operational audit?
KPMG International
  - then answer 20b


20b. How frequently does the operational audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 20d
Annually  - then answer 20d
Less than Annually  - then answer 20c
Other. Please explain in 20g.  - then answer 20g


20c. If less than annually, please explain:




20d. Are results of the operational audit publicly available? clear radio button selections
Yes  - then answer 20e
No  - then answer 20e


20e. Please select the statement that most accurately characterizes the results of the last operational audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 20f
Material exceptions found.  - then answer 20f
Other  - then answer 20f


20f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:




20g. If other, please explain:




20h. If other, please explain:




20i. Please list the date of your last operational audit performed by independent external accountants and the period that the audit covered:
Audit ended May 3, 2006 covering year 2005.


 21 
Do regulatory authorities perform an operational audit? (Choose all that apply.)

Yes  - then answer 21a
No  ›› take you to 22
Other  - then answer 21h


21a. If Yes, what is the name of the regulatory authority that handles the operational audit?
Hungarian Financial Supervisory Authority
  - then answer 21b


21b. How frequently does the operational audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 21d
Annually  - then answer 21d
Less than Annually  - then answer 21c
Other. Please explain in 21g.  - then answer 21g


21c. If less than annually, please explain:
On a random basis, less then annually.



21d. Are results of the operational audit publicly available? clear radio button selections
Yes  - then answer 21e
No  - then answer 21e


21e. Please select the statement that most accurately characterizes the results of the last operational audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 21f
Material exceptions found.  - then answer 21f
Other  - then answer 21f


21f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:
The depository was fined USD 5000,00 by HFSA for non-compliance with IT security regulations.

KELER prepared action plan and implemented necessary features to assure compliance.



21g. If other, please explain:




21h. If other, please explain:




21i. Please list the date of your last operational audit performed by regulatory authorities and the period that the audit covered:
Audit was performed during first half of 2006.


 22 
Do any other auditors perform an operational audit? (Choose all that apply.)

Yes  - then answer 22a
No  ›› take you to 23
Other  - then answer 22h


22a. If Yes, please explain and identify by name:

  - then answer 22b


22b. How frequently does the operational audit occur? (Choose one.) clear radio button selections
Two or more times a year  - then answer 22d
Annually  - then answer 22d
Less than Annually  - then answer 22c
Other. Please explain in 22g.  - then answer 22g


22c. If less than annually, please explain:




22d. Are results of the operational audit publicly available? clear radio button selections
Yes  - then answer 22e
No  - then answer 22e


22e. Please select the statement that most accurately characterizes the results of the last operational audit: (Choose one.) clear radio button selections
No material exceptions found.
Minor exceptions found.  - then answer 22f
Material exceptions found.  - then answer 22f
Other  - then answer 22f


22f. If minor, material or "other" exceptions were found, what actions were taken? Please describe:




22g. If other, please explain:




22h. If other, please explain:




22i. Please list the date of your last operational audit performed by any other auditors and the period that the audit covered:





PARTICIPANTS AND PARTICIPATION
The purpose of the section is to understand issues relating to participation in the depository, including eligibility requirements, conditions of participation, and supervision of participants.

Participant Eligibility Requirements
 23 
What types of entities are eligible to become participants and how many of each type are there currently? (Choose all that apply.)

Banks  - then answer 23a
Brokers  - then answer 23b
Individuals  - then answer 23c
Foreign Institutions  - then answer 23d
Other entities.  - then answer 23e
Not applicable


23a. How many Bank participants are there currently?
42
  - then answer 23g


23g. Please select the features included in the eligibility requirements for Banks. (Choose all that apply.)
Financial Thresholds  - then answer 23h
Regulatory Oversight  - then answer 23h
Market Experience  - then answer 23h
Other. Please explain in 23q.  - then answer 23q


23h. Where can a description of the specific eligibility requirements for Bank participants be found?
Capital Market Act, KELER Rules&Regulations



23q. Please explain:
Financial Thresholds apply to (CCP) clearing members only.



23b. How many Broker participants are there currently?
19
  - then answer 23i


23i. Please select the features included in the eligibility requirements for Brokers. (Choose all that apply.)
Financial Thresholds  - then answer 23j
Regulatory Oversight  - then answer 23j
Market Experience  - then answer 23j
Other. Please explain in 23r.  - then answer 23r


23j. Where can a description of the specific eligibility requirements for Broker participants be found?
Capital Market Act, KELER Rules&Regulations



23r. If other, please explain:
Financial Thresholds apply to clearing members only.



23c. How many Individual participants are there currently?

  - then answer 23k


23k. Please select the features included in the eligibility requirements for Individual participants. (Choose all that apply.)

Financial Thresholds  - then answer 23l
Regulatory Oversight  - then answer 23l
Market Experience  - then answer 23l
Other. Please explain in 23t.  - then answer 23t


23l. Where can a description of the specific eligibility requirements for Individual participants be found?




23t. If other, please explain:




23d. How many Foreign Institution participants are there currently?
3
  - then answer 23m


23m. Please select the features included in the eligibility requirements for Foreign Institution participants. (Choose all that apply.)
Financial Thresholds  - then answer 23n
Regulatory Oversight  - then answer 23n
Market Experience  - then answer 23n
Other. Please explain in 23u.  - then answer 23u


23n. Where can a description of the specific eligibility requirements for Foreign Institution participants be found?
Capital Market Act, KELER Rules&Regulations



23u. If other, please explain:
Financial Thresholds apply to clearing members only.



23e. If you have selected "Other entities" above, please explain:
Issuers, State Debt Management Agency, National Bank of Hungary, State Treasury, Specialized Financial Institutions, Fund Managers
  - then answer 23f


23f. Indicate how many "Other entities" are currently participants?
47
  - then answer 23o


23o. Please select the features included in the eligibility requirements for the participants referred to above as "Other entities". (Choose all that apply.)

Financial Threshold  - then answer 23p
Regulatory Oversight  - then answer 23p
Market Experience  - then answer 23p
Other. Please explain in 23s.  - then answer 23s


23p. Where can a description of the specific eligibility requirements for participants describe above as "Other entities" be found?

Capital Market Act, KELER Rules&Regulations



23s. If other, please explain:
Financial Thresholds apply to clearing members only.


 24 
Are participants required to contribute capital to the depository that would result in ownership of the depository? clear radio button selections

Yes  - then answer 24a
No
Not applicable
Other  - then answer 24b


24a. If yes, what fixed amount is required or what formula is used to determine the appropriate contribution level?




24b. If other, please explain:



 25 
Are prospective participants subject to an initial review and approval process regarding compliance with eligibility requirements? clear radio button selections

Yes
No
Not applicable
Other  - then answer 25a


25a. If other, please explain:






Conditions of participation
 26 
What governs the relationship between the depository and the participants? (Choose all that apply.)

Relevant law and regulation
Standard participation contract
Established terms and conditions of participation
By-laws of the depository
Rules of the depository
Other  - then answer 26a
Not applicable


26a. Please explain:



 27 
Rule 17f-7 requires that an Eligible Securities Depository “holds assets for the custodian that participates in the system on behalf of the Fund under safekeeping conditions no less favorable that the conditions that apply to other participants.”

Please confirm that assets of foreign investors held by custodians as participants in the depository are held under safekeeping conditions no less favorable than the conditions that apply to other participants.
clear radio button selections

Yes
No  - then answer 27a
Not applicable  - then answer 27a
Other  - then answer 27a


27a. If no, other or not applicable, please explain:



 28 
How does the depository notify participants of material changes to the conditions of participation? (Choose all that apply.)

By e-mail
By telephone
By public announcement
By press release
Other  - then answer 28a
Not applicable


28a. Please explain:
Via our proprietary communication system and website.





Governance of participants
 29 
Who enforces compliance with the depository’s conditions of participation? (Choose all that apply.)

The depository
The exchange
The depository's regulator
Other  - then answer 29a
Not applicable


29a. Please explain:



 30 
What enforcement actions are available to the enforcement authority? (Choose all that apply.)

Fines
Restrictions on participation
Suspension of participation
Termination of participation
Other  - then answer 30a
Not applicable


30a. Please explain:



 31 
Has there been any such enforcement actions in the last three years? clear radio button selections

Yes  - then answer 31a
No
Not applicable
Other  - then answer 31b


31a. If yes, please explain, including information relative to any suspensions of depository participants:
Non-performances in the CCP system of KELER, or non-compliance with reporting obligations occur every once in a while and result in fines and temporary suspensions.



31b. If other, please explain:





DEPOSITORY FUNCTIONALITY AND SERVICES; USE OF AGENTS
Certain functionalities and services reduce risk to an investor if provided in an efficient manner. The purpose of this section is to identify those functionalities that may potentially be offered by depositories and clearing systems around the world, and ascertain whether they are offered by your institution.

General
 32 
For which of the following security types do you serve as a depository or clearing system? (Choose all that apply.)

Government Securities  - then answer 32b
Equities  - then answer 32c
Corporate Bonds  - then answer 32d
Corporate Money Market Instruments  - then answer 32e
Others  - then answer 32a
Not applicable


32a. Please name the other security types:
Investment Fund Notes
  - then answer 32f


32f. Please name other depositories and clearing systems that handle the same securities listed in "Others" in your market:
Not applicable.



32b. Please name other depositories and clearing systems that handle Government Securities in your market:
Not applicable.



32c. Please name other depositories and clearing systems that handle Equities in your market:
Not applicable.



32d. Please name other depositories and clearing systems that handle Corporate Bonds in your market:
Not applicable.



32e. Please name other depositories and clearing systems that handle Corporate Money Market Instruments in your market:






Government Securities Settlements
 33 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the settlement of government securities?

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)
clear radio button selections

By law  - then answer 33a
By market practice  - then answer 33a
Neither/other  - then answer 33b
Not applicable


33a. What is the percentage of the total market of government securities in your jurisdiction (either volume or value) settled within your institution, exclusive of your links with third parties?




33b. If neither/other, please explain:
Goverment securities trades concluded on the Exchange must be settled through KELER by law. OTC settlements -by market practice-also take place in KELER, however custodians, may internalize transactions.





Government Securities Safekeeping
 34 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the safekeeping of government securities? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 34a
By market practice  - then answer 34a
Neither/other  - then answer 34b
Not applicable


34a. What is the percentage of the total market of government securities in your jurisdiction (either volume or value) held in safekeeping within your institution?
100%, since government securities are fully dematerialized.



34b. If neither/other, please explain:






Equities Settlements
 35 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the settlement of equities? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 35a
By market practice  - then answer 35a
Neither/other  - then answer 35b
Not applicable


35a. What is the percentage of the total market of equities in your jurisdiction (either volume or value) settled within your institution, exclusive of your links with third parties?




35b. If neither/other, please explain:
Equities trades concluded on the Exchange must be settled through KELER by law. Off-exchange settlements -by market practice-also take place in KELER, however custodians, may internalize transactions.





Equities Safekeeping
 36 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the safekeeping of equities? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 36a
By market practice  - then answer 36a
Neither/other  - then answer 36b
Not applicable


36a. What is the percentage of the total market of equities in your jurisdiction (either volume or value) held in safekeeping within your institution?




36b. If neither/other, please explain:
By law, all publicly issued equities must be in dematerialized form by year end 2004. All dematerialized equities are 100% administered through KELER by law.
Physical equities can be kept either outside or in KELER. KELER eligibility is subject to an agreement with the issuer.





Corporate Bonds Settlements
 37 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the settlement of corporate bonds? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 37a
By market practice  - then answer 37a
Neither/other  - then answer 37b
Not applicable


37a. What is the percentage of the total market of corporate bonds in your jurisdiction (either volume or value) settled within your institution, exclusive of your links with third parties?




37b. If neither/other, please explain:
Corporate bond trades concluded on the Exchange must be settled through KELER by law. OTC settlements -by market practice-also take place in KELER, however custodians, may internalize transactions.





Corporate Bonds Safekeeping
 38 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the safekeeping of corporate bonds? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 38a
By market practice  - then answer 38a
Neither/other  - then answer 38b
Not applicable


38a. What is the percentage of the total market of corporate bonds in your jurisdiction (either volume or value) held in safekeeping within your institution?




38b. If neither/other, please explain:
All publicly issued corporate bonds must be in dematerialized form as of year end 2004. All dematerialized bonds are 100% administered through KELER by law.
Physical bonds can be kept either outside or in KELER. KELER eligibility is subject to an agreement with the issuer.





Corporate Money Market Instruments Settlements
 39 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the settlement of corporate money market instruments? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 39a
By market practice  - then answer 39a
Neither/other  - then answer 39b
Not applicable


39a. What is the percentage of the total market of corporate money market instruments in your jurisdiction (either volume or value) settled within your institution, exclusive of your links with third parties?




39b. If neither/other, please explain:






Corporate Money Market Instruments Safekeeping
 40 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the safekeeping of corporate money market instruments? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 40a
By market practice  - then answer 40a
Neither/other  - then answer 40b
Not applicable


40a. What is the percentage of the total market of corporate money market instruments in your jurisdiction (either volume or value) held in safekeeping within your institution?




40b. If neither/other, please explain:






Other Eligible Securities Settlements
 41 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the settlement of other eligible securities? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 41a
By market practice  - then answer 41a
Neither/other  - then answer 41c
Not applicable


41a. What is the percentage of the total market of other eligible securities in your jurisdiction (either volume or value) settled within your institution, exclusive of your links with third parties?

  - then answer 41b


41b. Please provide description of the other securities:




41c. If neither/other, please explain:
Exchange listed closed-end investment funds must be settled in KELER by law. Open-end funds are usually not settled via KELER, the issuer directly distributes the notes to end investors within its own system. Settlement between the fund manager and the distributors may take place in KELER. The issuance and cancellation of dematerialized fund notes can only be executed via KELER by law.





Other Eligible Securities Safekeeping
 42 
Is the use of the depository in your market compulsory by law or compulsory by market practice for the safekeeping of other eligible securities? (Choose all that apply.)

(Please note that responses to questions 33 through 42 should be consistent with questions 73 and 74.)


By law  - then answer 42a
By market practice  - then answer 42a
Neither/other  - then answer 42c
Not applicable


42a. What is the percentage of the total market of other eligible securities in your jurisdiction (either volume or value) held in safekeeping within your institution?

  - then answer 42b


42b. Please provide description of the other securities:




42c. If neither/other, please explain:
All publicly issued investment funds must be in dematerialized form as of year end 2004. All dematerialized funds are 100% administered through KELER by law.
Physical funds can be kept either outside or in KELER. KELER eligibility is subject to an agreement with the issuer.


 43 
Are there any activities performed by a third party on behalf of the depository for the depository participants (e.g., vaulting of physical securities, registration, entitlement processing, etc.)? clear radio button selections

Yes  - then answer 43a
No
Not applicable
Other  - then answer 43g


43a. If third parties are employed, please indicate which services they supply:
Transportation of physical securities in / out of KELER's vault.
  - then answer 43b


43b. If third parties are employed, does the depository assume liability for losses incurred by participants as a result of the actions/inactions of the third parties? clear radio button selections
Yes  - then answer 43c
No


43c. If you acknowledge responsibility, please indicate whether your responsibility is assumed (Choose all that apply.)
regardless of whether such loss was caused by any action or inaction of the agent;  - then answer 43d
if such loss was caused by the agent's action or inaction and such action or inaction was deemed to be negligence on the part of the agent;  - then answer 43d
if such loss was caused by the agent's action or inaction and such action or inaction was deemed to be gross negligence on the part of the agent;  - then answer 43d
if the loss was caused by the willful default or other willful conduct on the part of the agent;  - then answer 43d
Other  - then answer 43h


43d. If you acknowledge responsibility for agents, your responsibility is assumed for losses (Choose all that apply.)
without limit.
which are not consequential losses.
subject to a monetary limit not based on insurance limits.  - then answer 43e
subject to a monetary limit based on insurance limits.  - then answer 43f
Other  - then answer 43i


43e. Please specify limit:




43f. Please specify limit:




43i. If other, please explain:




43h. If other, please explain:




43g. If other, please explain:



 44 
Has any participant suffered any losses in the past three years due to the depository’s performance? clear radio button selections

Yes  - then answer 44a
No
Not applicable
Other  - then answer 44m


44a. If yes, please select all of the following in which loss has occurred. You will be prompted to enter the number of instances and total loss in USD thereafter. (Choose all that apply.)
Corporate Action  - then answer 44b
Settlement Process - Securities  - then answer 44c
Settlement Process - Cash  - then answer 44d
System Outage  - then answer 44e
Other  - then answer 44f


44b. Corporate Action. Please specify number of instances:

  - then answer 44g


44g. Corporate Action. Please specify total loss in USD.




44c. Settlement Process - Securities. Please specify number of instances:

  - then answer 44h


44h. Settlement Process - Securities. Please specify total loss in USD:




44d. Settlement Process - Cash. Please specify number of instances:

  - then answer 44i


44i. Settlement Process - Cash. Please specify total loss in USD:




44e. System Outage. Please specify number of instances:

  - then answer 44j


44j. System Outage. Please specify total loss in USD:




44f. If Other, please explain:

  - then answer 44k


44k. For Other, please specify number of instances:

  - then answer 44l


44l. For Other, please specify total loss in USD:




44m. If other, please explain:






Other Services
 45 
Who accepts cash deposits for depository transactions? (Choose all that apply.)

Depository
Central Bank
Banks appointed by depository.  - then answer 45a
Others  - then answer 45b
Not applicable


45a. Please name banks:




45b. If others, please explain:



 46 
Who processes cash clearing for depository transactions? (Choose all that apply.)

Depository
Central Bank
Banks appointed by depository.  - then answer 46a
Others  - then answer 46b
Not applicable


46a. Please name banks appointed by depository:




46b. If others, please explain:



 47 
Who controls the movement of cash for cash deposits? (Choose all that apply.)

Depository
Central Bank
Banks appointed by depository.  - then answer 47a
Others  - then answer 47b
Not applicable


47a. Please name banks appointed by depository:




47b. If others, please explain:



 48 
Who controls the movement of cash for cash clearing? (Choose all that apply.)

Depository
Central Bank
Banks appointed by depository.  - then answer 48a
Others  - then answer 48b
Not applicable


48a. Please name banks appointed by depository:




48b. If others, please explain:



 49 
Please indicate services you provide. (Choose all that apply.)

Information in advance on corporate (annual or special) meetings in order that owners can vote.
Tax assistance where foreign holders may be entitled to tax relief at source or through a claim.
In order to avoid fails, an automatic securities lending facility - if requested - is provided for:  - then answer 49a
Collateral handling in support of activities including securities lending, overdraft coverage, cash management, repurchase agreements, etc. Please provide details  - then answer 49c
Same day turnaround settlements.
Information on distribution of new issues (IPO, Privatization).
Other.  - then answer 49d
Not applicable


49a. Automatic securities lending facility is provided for: (Choose all that apply.)
Brokers
Banks
Other Financial Institutions
Other  - then answer 49b


49b. If Other, please explain:
The automatic lending facility is available to all (CCP) clearing members who are brokers and banks.



49c. Collateral Handling: Please provide details:
(CCP) clearing membership and guaranteed trading activity requires collateral from members. These include: contributions to Collective guarantee Funds; Initial financial collateral; Initial Margin; Variation Margin; Additional Financial Collateral. Cash financing transactions to support settlement are also subject to collateral from the participant. In addition, KELER handles collateral for the Central Bank to back credit lines.



49d. If Other services, please explain:
NOTE: Tax assistance applies only in case when the non-domestic custodian of foreign holder is direct client of KELER. OTHER SERVICES: 1.Cross-border settlement and custody 2. Share Registrar and paying agent services


 50 
What procedures are in place for the collection of corporate action entitlements? (Choose all that apply.)

Credited to the securities account on the day indicated below regardless of whether actually collected by the depository on the scheduled date  - then answer 50a
Credited to the securities account upon actual receipt by the depository.
Corporate action entitlements are handled by an entity separate from the depository.   - then answer 50c
Not applicable.
Other. Please explain in 50d.  - then answer 50d


50a. Credited to the securities account: (Choose all that apply.)
On pay date.
On pay date +1.
On pay date +2.
Other.  - then answer 50b


50b. If other, please explain:




50c. Name of entity:




50d. If other, please explain:



 51 
What is the average percentage of entitlements that have actually been collected by the depository when the credits are made to the participant accounts?

100%


 52 
What procedures are in place for the collection of interest and dividends? (Choose all that apply.)

Credited to the cash account on the day indicated below regardless of whether actually collected by the depository on the scheduled date  - then answer 52a
Credited to the cash account upon actual receipt by the depository.
Income and dividend collection is handled by an entity separate from the depository.  - then answer 52c
Not applicable.
Other. Please explain in 52d.  - then answer 52d


52a. Credited to the cash account: (Choose all that apply.)
On pay date.
On pay date +1.
On pay date +2.
Other.  - then answer 52b


52b. If other, please explain:




52c. Name of entity:
Payments are the responsibility of the issuer based on record date positions provided by the csd and payment details provided by the investor. Paying agent is appointed by the issuer.



52d. If other, please explain:



 53 
What is the average percentage of income receipts which have actually been collected by the depository from issuers or paying agents when the credits are made to the participant accounts?

40%





Linkages with Other Central Securities Depositories (CSD) or International Central Securities Depositories (ICSD)
 54 
Please identify the existence and scope of electronic processing linkages with foreign depositories or settlement systems:

Do you have any electronic processing linkages with foreign depositories or settlement systems?
clear radio button selections

Yes
No  ›› take you to 63
Other. Please explain in 54a.  - then answer 54a and  ›› take you to 63
Not applicable  ›› take you to 63


54a. If other, please explain:



 55 
If yes, identify entity, name of CSD or ICSD with which linkage has been established (if more than one, you will be prompted to enter their name at the end of this series of questions):


Clearstream Banking S.A.
  - then answer 55a


55a. Is the linkage Unilateral or Bilateral? (For an explanation of unilateral linkage and bilateral linkage, click on the "Help" button on the tool bar on the right side of this page.) (Choose all that apply.)
Unilateral  - then answer 55b
Bilateral  - then answer 55b
Not applicable
Other  - then answer 55l


55b. Does an intermediary provide interface to depository? clear radio button selections
Yes  - then answer 55c
No  - then answer 55d


55c. If yes, name intermediary:




55d. Is cross listing on the other exchange mandatory for usage of depository linkages? clear radio button selections
Yes  - then answer 55e
No  - then answer 55e


55e. Is Delivery-vs.-payment settlement possible? clear radio button selections
Yes
No
Other. Please explain in 55j.  - then answer 55j


55f. Is Free-of-payment settlements required? clear radio button selections
Yes
No
Other. Please explain in 55k.  - then answer 55k


55k. If other, please explain:




55g. Timing of transfers: How are they effected? (Choose all that apply.)
Batch mode
Real time
Not applicable
Other  - then answer 55m


55m. If other, please explain:




55h. What is the percentage of all trades settled at your institution with this CSD or ICSD link?
not available



55i. Do you have any additional electronic processing linkages with foreign depositories or settlement systems? clear radio button selections
Yes. If so please proceed to next question.
No  ›› take you to 60
Other  - then answer 55n


55n. If other, please explain:




55j. If other, please explain:




55l. If other, please explain:



 56 
If yes, identify entity, name of CSD or ICSD with which linkage has been established (if more than one, you will be prompted to enter their name at the end of this series of questions):


OeKB
  - then answer 56a


56a. Is the linkage Unilateral or Bilateral? (For an explanation of unilateral linkage and bilateral linkage, click on the "Help" button on the tool bar on the right side of this page.) (Choose all that apply.)
Unilateral  - then answer 56b
Bilateral  - then answer 56b
Not applicable
Other  - then answer 56l


56b. Does an intermediary provide interface to depository? clear radio button selections
Yes  - then answer 56c
No  - then answer 56d


56c. If yes, name intermediary:




56d. Is cross listing on the other exchange mandatory for usage of depository linkages? clear radio button selections
Yes  - then answer 56e
No  - then answer 56e


56e. Is Delivery-vs.-payment settlement possible? clear radio button selections
Yes
No
Other. Please explain in 56j.  - then answer 56j


56f. Is Free-of-payment settlements required? clear radio button selections
Yes
No
Other. Please explain in 56k.  - then answer 56k


56k. If other, please explain:




56g. Timing of transfers: How are they effected? (Choose all that apply.)
Batch mode
Real time
Not applicable
Other  - then answer 56m


56m. If other, please explain:




56h. What is the percentage of all trades settled at your institution with this CSD or ICSD link?
Not available.



56i. Do you have any additional electronic processing linkages with foreign depositories or settlement systems? clear radio button selections
Yes. If so please proceed to next question.
No  ›› take you to 60
Other  - then answer 56n


56n. If Other, please explain:




56j. If other, please explain:




56l. If other, please explain:



 57 
If yes, identify entity, name of CSD or ICSD with which linkage has been established (if more than one, you will be prompted to enter their name at the end of this series of questions):


KDPW
  - then answer 57a


57a. Is the linkage Unilateral or Bilateral? (For an explanation of unilateral linkage and bilateral linkage, click on the "Help" button on the tool bar on the right side of this page.) (Choose all that apply.)
Unilateral  - then answer 57b
Bilateral  - then answer 57b
Not applicable
Other  - then answer 57l


57b. Does an intermediary provide interface to depository? clear radio button selections
Yes  - then answer 57c
No  - then answer 57d
Other  - then answer 57n


57c. If yes, name intermediary:




57d. Is cross listing on the other exchange mandatory for usage of depository linkages? clear radio button selections
Yes  - then answer 57e
No  - then answer 57e
Other  - then answer 57o


57e. Is Delivery-vs.-payment settlement possible? clear radio button selections
Yes
No
Other. Please explain in 57j.  - then answer 57j


57f. Is Free-of-payment settlements required? clear radio button selections
Yes
No
Other. Please explain in 57k.  - then answer 57k


57k. If other, please explain:




57g. Timing of transfers: How are they effected? (Choose all that apply.)
Batch mode
Real time
Not applicable
Other  - then answer 57m


57m. If other, please explain:




57h. What is the percentage of all trades settled at your institution with this CSD or ICSD link?
Not available



57i. Do you have any additional electronic processing linkages with foreign depositories or settlement systems? clear radio button selections
Yes. If so please proceed to next question.
No  ›› take you to 60
Other  - then answer 57p


57p. If other, please explain:




57j. If other, please explain:




57o. If other, please explain:




57n. If Other, please explain:




57l. If other, please explain:



 58 
If yes, identify entity, name of CSD or ICSD with which linkage has been established (if more than one, you will be prompted to enter their name at the end of this series of questions):



  - then answer 58a


58a. Is the linkage Unilateral or Bilateral? (For an explanation of unilateral linkage and bilateral linkage, click on the "Help" button on the tool bar on the right side of this page.) (Choose all that apply.)
Unilateral  - then answer 58b
Bilateral  - then answer 58b
Not applicable
Other  - then answer 58l


58b. Does an intermediary provide interface to depository? clear radio button selections
Yes  - then answer 58c
No  - then answer 58d
Other  - then answer 58n


58c. If yes, name intermediary:




58d. Is cross listing on the other exchange mandatory for usage of depository linkages? clear radio button selections
Yes  - then answer 58e
No  - then answer 58e
Other  - then answer 58o


58e. Is Delivery-vs.-payment settlement possible? clear radio button selections
Yes
No
Other. Please explain in 58j.  - then answer 58j


58f. Is Free-of-payment settlements required? clear radio button selections
Yes
No
Other. Please explain in 58k.  - then answer 58k


58k. If other, please explain:




58g. Timing of transfers: How are they effected? (Choose all that apply.)
Batch mode
Real time
Not applicable
Other  - then answer 58m


58m. If other, please explain:




58h. What is the percentage of all trades settled at your institution with this CSD or ICSD link?




58i. Do you have any additional electronic processing linkages with foreign depositories or settlement systems? clear radio button selections
Yes. If so please proceed to next question.
No  ›› take you to 60
Other  - then answer 58p


58p. If other, please explain:




58j. If other, please explain:




58o. If other, please explain:




58n. If other, please explain:




58l. If other, please explain:



 59 
If yes, identify entity, name of CSD or ICSD with which linkage has been established (if more than one, you will be prompted to enter their name at the end of this series of questions):



  - then answer 59a


59a. Is the linkage Unilateral or Bilateral? (For an explanation of unilateral linkage and bilateral linkage, click on the "Help" button on the tool bar on the right side of this page.) (Choose all that apply.)
Unilateral  - then answer 59b
Bilateral  - then answer 59b
Not applicable
Other  - then answer 59m


59b. Does an intermediary provide interface to depository? clear radio button selections
Yes  - then answer 59c
No  - then answer 59d
Other  - then answer 59o


59c. If yes, name intermediary:




59d. Is cross listing on the other exchange mandatory for usage of depository linkages? clear radio button selections
Yes  - then answer 59e
No  - then answer 59e
Other  - then answer 59p


59e. Is Delivery-vs.-payment settlement possible? clear radio button selections
Yes
No
Other. Please explain in 59j.  - then answer 59j


59f. Is Free-of-payment settlements required? clear radio button selections
Yes
No
Other. Please explain in 59k.  - then answer 59k


59k. If other, please explain:




59g. Timing of transfers: How are they effected? (Choose all that apply.)
Batch mode
Real time
Not applicable
Other  - then answer 59n


59n. If other, please explain:




59h. What is the percentage of all trades settled at your institution with this CSD or ICSD link?




59i. Do you have any additional electronic processing linkages with foreign depositories or settlement systems? clear radio button selections
Yes. If so please proceed to next question.  - then answer 59l
No  ›› take you to 60
Other  - then answer 59q


59l. If yes, please prepare and upload a document with the additional information here:
   



59q. If other, please explain:




59j. If other, please explain:




59p. If other, please explain:




59o. If other, please explain:




59m. If other, please explain:



 60 
What governs the relationship in cross-system settlements? (Choose all that apply.)

Negotiated terms and conditions of participation between the depositories
By-laws of each depository
Standard participation contracts with users of cross-system services
Laws of the jurisdiction where settlement occurs
Other  - then answer 60a


60a. Please explain:



 61 
Are procedures and controls (firewalls) in place to avoid systemic collapse or contamination if one of the linked entities should experience business interruptions for whatever reason? clear radio button selections

Yes  - then answer 61a
No  - then answer 61a
Other  - then answer 61a
Not applicable


61a. Please explain:
Business Contingency Plan is in place. Funds or securities are always blocked before payment or delivery and are never advanced before credit or receipt.


 62 
Has a business interruption recovery plan been developed in the event the linkages should become inoperable for any reason? clear radio button selections

Yes
No
Other  - then answer 62a
Not applicable


62a. If other, please explain:





ACCOUNT STRUCTURES AND RECORDKEEPING
The purpose of this section is to identify the nature of accounts; the naming convention employed, the level of segregation achieved, accessibility in the event of bankruptcy and the frequency of reporting generated from them.
 63 
Are participants permitted to maintain more than one account at the depository? clear radio button selections

Yes  - then answer 63a
No
Not applicable
Other  - then answer 63d


63a. If yes, please indicate number (Choose one.): clear radio button selections
An unlimited number of accounts.
More than one account, if so please indicate below how many.  - then answer 63b
Other (e.g., subaccounts).  - then answer 63c


63b. If more than one account what is the maximum?




63c. If other, please explain:
Participants may open separate main securities accounts for different activities (eg. treasury vs custody). In addition, participants can open an unlimited number of securities subaccounts.



63d. If other, please explain:



 64 
Are participants required/permitted to segregate assets held for their own benefit from those they hold for their clients? clear radio button selections

Yes  - then answer 64a
No
Not applicable
Other  - then answer 64d


64a. If yes, is segregation required or simply permitted? clear radio button selections
Required  - then answer 64b
Permitted  - then answer 64b
Other  - then answer 64e


64b. How does segregation occur? (Choose all that apply.)
By separately designated participant accounts.
By sub-accounts within a single participant account.
By separately designated beneficial owner accounts.
Other (e.g., share registration).   - then answer 64c


64c. If other, please explain:




64e. If other, please explain:




64d. If other, please explain:



 65 
Does the depository permit its participants to open accounts in the participant's own nominee name(s)? clear radio button selections

Yes  - then answer 65a
No
Other. Please explain in 65b.  - then answer 65b
Not applicable


65a. If “Yes”, do laws exist which acknowledge the rights of beneficial owners with respect to securities registered in nominee name? clear radio button selections
Yes
No


65b. If other, please explain:
Main accounts within KELER must be in the participants' own name, however a nominee name can be applied to any underlying subaccount.
Laws exist to acknowledge the rights of beneficial owners with respect to shares registered in a nominee name.


 66 
In the event a participant's single account is blocked for any reason (e.g., insolvency, penalties, violations, liens), would securities held in the account on behalf of the participant's clients be accessible:



66a. By the participant's clients? clear radio button selections
Yes  - then answer 66b
No
Not applicable.
Other  - then answer 66i


66b. If yes, please describe briefly how clients of participants would access their securities and whether there would be any delay in their ability to do so:




66i. If other, please explain:




66c. By the intervening authorities controlling insolvency or other proceedings? clear radio button selections
Yes  - then answer 66d
No
Not applicable.
Other  - then answer 66j


66d. If yes, please describe briefly under what conditions access would be granted to the intervening authorities:
The competent authority ordering the blocking of the account may grant access.



66j. If other, please explain:




66e. By the participant's creditors? clear radio button selections
Yes  - then answer 66f
No
Not applicable.
Other  - then answer 66k


66f. If yes, please describe briefly under what conditions access would be granted to the participant’s creditors:




66k. If other, please explain:




66g. By the depository's creditors? clear radio button selections
Yes  - then answer 66h
No
Not applicable.
Other  - then answer 66l


66h. If yes, please describe briefly under what conditions access would be granted to the depository’s creditors:




66l. If other, please explain:



 67 
In what form does the depository maintain records identifying the assets of each participant? (Choose all that apply.) (Please refer to "Help" for clarification.)

Computer file  - then answer 67b
Microfiche  - then answer 67b
Hard copy  - then answer 67b
Computer tape  - then answer 67b
Other  - then answer 67a


67a. If other, please explain:
CD, daily



67b. In which format is the source data maintained?
prn file format on CD


 68 
Rule 17f-7 requires that an Eligible Securities Depository “provides periodic reports to its participants with respect to its safekeeping of assets, including notices of transfers to or from any participant’s account.”

Does the depository make available periodic safekeeping reports to participants, including notices of transfers to or from the participant’s account?
clear radio button selections

Yes  - then answer 68b
No (You will be asked to confirm whether you want to move on to 70 in advance of answering subquestion 68a, do not be alarmed as it will allow you to answer 68a before moving on.)  - then answer 68a and  ›› take you to 70
Other  - then answer 68a


68a. If no or other, please explain:




68b. If yes, please indicate the scheduled frequency: (Choose one.) clear radio button selections
Daily.
Weekly.
Monthly.
Quarterly.
Annually.
Upon Request.
Other.  - then answer 68c


68c. If other, please explain:
Based on the type of transaction/report, automatically in real-time, upon request in real-time and at the end of the day.


 69 
What is your document retention policy for documents described in previous question? (Choose one.) clear radio button selections

6 months or less.
1 year.
3 years.
5 years.
7 years.
Other.  - then answer 69a


69a. If other, please explain:





SETTLEMENTS
The purpose of this section is to identify the model of settlement employed, the relationship between cash and securities, and the basis on which participants’ meet their obligations.
 70 
The Committee on Payment and Settlement Systems of the Bank for International Settlements (BIS) has identified three common structural approaches or models for linking delivery and payment in a securities settlement system. Please indicate which model your procedures most closely resemble (Please refer to details on the models within the "Help" feature connected with this question): (Choose all that apply.)

Model 1 - Gross, Simultaneous Settlements of Securities and Funds Transfers.  - then answer 70a
Model 2 - Gross Settlements of Securities Transfers Followed by Net Settlement of Funds Transfers.  - then answer 70a
Model 3 - Simultaneous Net Settlement of Securities and Funds Transfers.  - then answer 70a
Not applicable
Other  - then answer 70b


70a. How do your settlement procedures vary from the model chosen above?
No difference from standard models.
Note:
Model 1 for off Exchange settlements
Model 3 for Exchange cash market settlements



70b. If other, please explain:



 71 
Are the cash and security movements simultaneous? clear radio button selections

Yes
No  - then answer 71a
Not applicable
Other  - then answer 71c


71a. If cash and security movements are not simultaneous, please indicate the duration of the timing gap: (Choose one.) clear radio button selections
1 hour or less
2 hours
3 hours
4 hours
5 hours
Overnight
2 days
Other  - then answer 71b


71b. If other, please explain:




71c. If other, please explain:





OWNERSHIP OF SECURITIES
The purpose of this section is to determine how ownership of securities is represented, the ways the depository maintains ownership or control of securities held in the depository, and the extent to which ownership of assets held by the depository is separated from the proprietary assets of the depository. This section also considers the process by which the ownership of securities is transferred in the depository and the existence of any liens or claims on depository securities (such as a clearing lien) that would affect the ownership of depository securities.
 72 
How are depository eligible securities held by the depository?

Securities in the depository are held in certificated form.  - then answer 72b
Securities in the depository are held in dematerialized form. (You will be asked to confirm whether you want to move on to 74 in advance of answering subquestion 72c, do not be alarmed as it will allow you to answer 72c before moving on.)  - then answer 72c
Other.  - then answer 72a


72a. If other, please explain and identify percentage issued of total depository holdings:




72b. If held in certificated form, please indicate next to the type of security the percentage of the depository's total issues that each security represents. (Please provide numeric answer.)
 Government Securities in jumbo certificate form
 Equities in jumbo certificate form
 Corporate Bonds in jumbo certificate form
 Corporate Money Markets in jumbo certificate form
 Government Securities in individual certificate form
 Equities in individual certificate form
 Corporate Bonds in individual certificate form
 Corporate Bonds in individual certificate form
 Corporate Money Markets in individual certificate form
 Other - please explain in 72d.


72d. If other, please explain:
Investment fund notes.



72c. If held in dematerialized form, please indicate next to the type of security the percentage of the depository's total issues that each security represents. (Please provide numeric answer.)
 Government Securities
 Equities
 Corporate Bonds
 Corporate Money Markets
 Other - please explain in 72e.


72e. If other, please explain:
Investment fund notes.


 73 
If depository eligible securities are certificated, can depository eligible securities be held outside of the depository?

All eligible securities must be held in the depository.  - then answer 73b
Securities may move freely into and out of the depository.  - then answer 73g
Once entered into the depository, eligible securities must remain in the depository.  - then answer 73b
Certain designated securities may be held outside the depository.  - then answer 73a
Not Applicable.
Other  - then answer 73j


73a. If certain designated securities are held outside the depository, please indicate under which conditions these securities would be held outside the depository:




73b. If depository eligible securities are required to be centrally immobilized at the depository, where and with whom are the certificates safekept?

  - then answer 73c


73c. Are these certificates: clear radio button selections
Bearer
Registered  - then answer 73d
Other  - then answer 73k


73d. If registered, how are the depository eligible securities registered? (Do not be alarmed, the last two options will prompt you to ask whether you wish to proceed to 75 before allowing you to answer the subquestion but you will be given the opportunity to answer the subquestion before continuing).
In the name of the depository.
In the name of the depositing participant or its nominee.
In the name of a separate nominee of the depository.  - then answer 73f
Other.  - then answer 73e


73e. If other, please describe:
Blank endorsed.



73f. If in the name of a separate nominee, please identify by name the nominee used:




73k. If other, please explain:




73g. If depository eligible securities may be held either in or out of the depository, are these certificates:
Bearer  - then answer 73h
Registered  - then answer 73h
Other. Please explain in 73i.  - then answer 73i


73h. What are the control features for receipt of certificates to the depository (e.g., authentication procedures, re-registration)? Please describe:
Participants must inform the Depository before deliveries. Usually the professional transport company used by KELER collects the securities from the participants at their depository and the clients are requested to deliver securities to KELER only in rare circumstances. The professional transport company delivers securities directly to the vault area. The company supplies the identification of its employees to KELER in writing: ID number used by the transport company, signature sample. KELER sends the identification to the custodians who are responsible for ensuring that only these people perform transportation on their behalf. KELER's liability starts at the mantrap room, where securities are handed over to the vault personnel. No transporter is allowed to enter the vault area. Small deliveries by the participants can be made delivering securities to the office area (ante-room) also. Receipt of securities is effected in two stages: 1. at the first stage, upon receipt of securities and checking of signatures of the delivering participant, KELER confirms the bulk receipt of securities, 2. the closed parcels are then passed onto the Receipt group, who will check the securities whether they are not fraudulent, are in good physical condition, are of full value (all due coupons are attached to them), blank endorsed, and with the help of OCRs (Optical Character Reader) will count the securities, register the denominations and individual serial numbers. (Smaller receipts can be processed manually.) These are then compared to the delivery note prepared by the KELER participant. All three members of the Receipt team sign the note. The checking process is then repeated by the head of the Receipt team, after which the securities are sent to the Data entry team. Serial numbers are automatically checked by the system comparing to the list of serial numbers regarding fraudulent, suspended securities. At the end of the process system print-outs are again compared to the original delivery note and it is only at this stage that the securities are credited to the requested account or sub-account, and a formal, full receipt is compiled and mailed to the depositor.



73i. If other, please explain:




73j. If other, please explain:



 74 
If securities are dematerialized:

May dematerialized security positions be re-certificated and held outside the depository?
clear radio button selections

Yes  - then answer 74a
No  - then answer 74a
Not Applicable
Other  - then answer 74j


74a. Are the securities held: (Choose all that apply.)
Through book-entry at the depository
Through book-entry at a registrar or issuer  - then answer 74b
Other  - then answer 74k


74b. Please identify which types of entities may act as registrars: (Choose all that apply.)
Issuers
Separate companies that perform registrar functions
Depository
Other  - then answer 74c


74c. Please explain:




74d. If the securities held by the depository are recorded by book entry at the registrar, are the securities registered only to the depository, with the depository providing the function of recording ownership on a centralized basis for the market? (Choose all that apply.)
Yes  - then answer 74e
No  - then answer 74g
Other  - then answer 74l


74e. If yes, how are securities held at the registrar for the account of the depository? (Choose one.) clear radio button selections
In the name of the depository
In the name of a separate nominee of the depository
Other  - then answer 74f


74f. Please describe:




74g. If the securities held with the depository are recorded by book-entry at the registrar but are not registered exclusively to the depository, may they be registered to:
The beneficial owner
A nominee
Other  - then answer 74h


74h. Please describe:




74i. If the securities held with the depository are recorded by book-entry at the registrar, what are the control features at the registrar for transfer of registrar positions to and from the depository (e.g., authentication procedures, reconciliation, confirmation of position at registrar)? Please describe:




74l. If other, please explain:




74k. If other, please explain:




74j. If other, please explain:



 75 
Rule 17f-7 requires that an Eligible Securities Depository “maintains records that identify the assets of each participant and segregate the system’s own assets from the assets of participants.”

Does the depository maintain records that identify the assets of each participant and segregate the system's own assets from the assets of participants?
clear radio button selections

Yes
No
Not applicable  - then answer 75a
Other  - then answer 75a


75a. If other, please explain:



 76 
Does the law protect participant assets from claims and liabilities of the depository? clear radio button selections

Yes
No
Not applicable
Other  - then answer 76a


76a. If other, please explain:



 77 
Can the depository assess a lien on participant accounts? (A lien would entitle the depository to take and hold or sell the securities of the participant in payment of a debt.) clear radio button selections

Yes  - then answer 77a
No
Not applicable
Other  - then answer 77l


77a. If yes, for what reasons are liens or similar claims imposed? (Choose all that apply.)
Fees and expenses
Collateralization of overdrafts
To secure payment for purchased securities
Other  - then answer 77b


77b. Please describe:




77c. Please indicate the limits of this lien as indicated below: (Choose one.) clear radio button selections
The lien is limited to securities in the participant’s proprietary account.
The lien is limited to securities in the course of purchase and sale transactions, but does not extend to settled positions.
The lien may extend to settled client positions.  - then answer 77d
Other. Please explain in 77d.  - then answer 77d


77d. Please explain:




77e. If a lien is placed on a participant’s account which has been designated for its clients, will the depository select certain securities to be subject to the lien? clear radio button selections
Yes  - then answer 77f
No  - then answer 77h
Other  - then answer 77m


77f. If yes, please indicate whether: (Choose one.) clear radio button selections
the lien is placed on the most liquid securities in the account
the lien is placed on the securities with the greatest value in the account
other selection criteria is used.  - then answer 77g


77g. Please explain:




77h. If no, please indicate whether the entire account will be subject to the lien. clear radio button selections
Yes
No
Other  - then answer 77n


77n. If other, please explain:




77i. For accounts designated as client accounts, do procedures exist to restrict the placement of liens only to obligations arising from safe custody and administration of those accounts? clear radio button selections
Yes  - then answer 77j
No
Other  - then answer 77o


77j. If yes, are the restrictions accomplished by: clear radio button selections
contract between the depository and the participant
other procedures  - then answer 77k


77k. Please explain:




77o. If other, please explain:




77m. If other, please explain:




77l. If other, please explain:



 78 
Transfer of Legal Ownership

Does the depository have legal authority to transfer title to securities?
clear radio button selections

Yes  - then answer 78a
No
Not applicable
Other  - then answer 78e


78a. When does title or entitlement to depository securities pass between participants? (Choose one.) clear radio button selections
At the end of the business day on which the transfer occurs.  - then answer 78c
When corresponding money or other consideration is transferred.  - then answer 78c
When the transaction is processed on an intra-day basis.  - then answer 78c
Other.  - then answer 78b


78b. Please describe:




78c. Where does title or entitlement to depository securities pass between participants? (Choose one.) clear radio button selections
On the depository books.
On the registrars books.
Other.  - then answer 78d


78d. Please describe:




78e. If other, please explain:





HANDLING OF SECURITIES OUTSIDE THE DEPOSITORY ENVIRONMENT
The purpose of this section is to consider the process (and any risk inherent within such a process) that involves the safekeeping of client assets while they are being removed from a depository or being lodged into a depository.
 79 
How are eligible securities lodged in the depository system? (Choose all that apply.)

A registered certificate in the name of the depository is delivered to the depository.
A participant delivers the security with a valid transfer deed or stock power or other transfer document to the depository which then effects registration.
A registrar re-registers the security in the name of the depository.
Other.  - then answer 79a
Not applicable


79a. Please describe:
All participants must deliver the securities to the depository with a blank endorsment in order to comply with fungibility requirements.


 80 
When are securities lodged into the depository reflected in a participant's depository account? (Choose all that apply.)

Securities are reflected in the participant's depository account immediately upon delivery to the depository.
Securities are re-registered prior to being reflected in the participant’s depository account.
Other.  - then answer 80a
Not applicable


80a. Please explain:
Normally on the same day. After delivering securities to the depository, there is a checking process. (pls. see answer 74/h). Securities will be credited to the requested account (or sub-account) striclty after this well done process. Normally it can be done on the same day. In case of any anomalies demanding repeated checkings, the reflection will may be done only on the next day.


 81 
How long does it usually take to lodge securities with the depository? (Choose one.) clear radio button selections

1 to 2 days.
3 days to 1 week.
2 to 4 weeks.
More than 4 weeks.  - then answer 81a
Not applicable.
Other. Please explain in 81b.  - then answer 81b


81a. Please specify:




81b. If other, please explain:



 82 
During the process of lodging securities into the depository, can the securities:

Be traded?
clear radio button selections

Yes
No  - then answer 82c
Not applicable
Other  - then answer 82c


82a. During the process of lodging securities into the depository, can the securities:

Be settled?
clear radio button selections
Yes
No  - then answer 82d
Not applicable
Other  - then answer 82d


82b. During the process of lodging securities into the depository, can the securities:

Have ownership transferred?
clear radio button selections
Yes
No  - then answer 82e
Not applicable
Other  - then answer 82e


82e. If ownership can not be transferred, or if you answered other, please explain:




82d. If they can not be settled, of if you answered other, please explain:




82c. If they can not be traded, or if you answered other, please explain:



 83 
Are securities immediately available for delivery upon transfer to the depository? clear radio button selections

Yes
No  - then answer 83a
Not applicable
Other  - then answer 83d


83a. If no: Securities are unavailable for: clear radio button selections
1 to 2 days
3 days to 1 week
2 to 4 weeks
More than 4 weeks  - then answer 83b
Other. Please explain in 83c.  - then answer 83c


83b. If more than 4 weeks, please specify:




83c. If other, please explain:




83d. If other, please explain:



 84 
Are eligible securities held through the depository afforded the same or greater efficiencies as securities held outside the depository with respect to:



84a. Income? (Choose one.) clear radio button selections
Not applicable
No  - then answer 84b
Yes - for all instrument types
Yes - for the following instrument types only:  - then answer 84c
Other  - then answer 84b


84b. Please explain:




84c. Name instrument types:




84d. Corporate actions? clear radio button selections
Not applicable
No  - then answer 84e
Yes - for all instrument types
Yes - for the following instrument types only:  - then answer 84f
Other  - then answer 84e


84e. Please explain:




84f. Name instrument types:




84g. Proxy Services? clear radio button selections
Not applicable
No  - then answer 84h
Yes - for all instrument types
Yes - for the following instrument types only  - then answer 84i
Other  - then answer 84h


84h. Please explain:




84i. Name instrument types:



 85 
Can securities held outside of the depository:



85a. Be traded without being lodged at the depository? clear radio button selections
No  - then answer 85b
Not applicable
Yes
Other  - then answer 85b


85b. Please explain:




85c. Be settled without being lodged at the depository? clear radio button selections
No  - then answer 85d
Not applicable
Yes  - then answer 85e
Other  - then answer 85d


85d. Please explain:
No, if trade is concluded on the Exchange. Yes, if Exchange listed instruments are NOT traded through a licenced broker, or securities are not listed on the exchange.



85e. If yes, do settlements of depository-eligible securities occurring outside the depository take longer to settle? clear radio button selections
Yes
No
Not applicable
Other  - then answer 85h


85h. If other, please explain:




85f. Have ownership transferred without being lodged at the depository? clear radio button selections
No  - then answer 85g
Not applicable
Yes
Other  - then answer 85g


85g. Please explain:



 86 
How are eligible securities removed from the depository? (Choose one.) clear radio button selections

Securities are re-registered into the name of the beneficial owner or a nominee.
Securities are re-certificated and re-registered into the name of the beneficial owner or a nominee.
Securities are re-certificated and delivered as bearer instruments.
Securities are transferred as is any physical delivery in the market.
Other  - then answer 86a
Not applicable


86a. Please specify:



 87 
How long does it usually take to remove securities from the depository? (Choose one.) clear radio button selections

1 to 2 days
3 days to 1 week
2 to 4 weeks
More than 4 weeks  - then answer 87a
Not applicable
Other. Please explain in 87b.  - then answer 87b


87a. Please specify:




87b. If other, please explain:



 88 
While the securities are being removed from the depository, can they:



88a. Be traded? (Choose one.) clear radio button selections
No  - then answer 88b
Not applicable
Yes
Other  - then answer 88b


88b. Please explain:




88c. Be settled? clear radio button selections
No  - then answer 88d
Not applicable
Yes
Other  - then answer 88d


88d. Please explain:




88f. Have ownership transferred? clear radio button selections
No  - then answer 88g
Not applicable
Yes
Other  - then answer 88g


88g. Please explain:



 89 
Where are securities that are outside the depository held in safekeeping? (Choose all that apply.)

Securities are dematerialized; ownership of securities is identified through the records of the company registrar.
Securities are held physically, registered on behalf of the beneficial owner or a nominee and physically safekept by subcustodian banks.
Securities are held physically in bearer form in subcustodian banks.
Securities may be held physically by brokers, the registrar, or beneficial owner.
Other  - then answer 89a
Not applicable


89a. Please specify:





STANDARD OF CARE
The purpose of this section is to understand the responsibility and liability that the depository has in providing services to its participants/members in the settlement and clearing of securities and/or cash, and to understand what type of protections exist for participants in the event of a participant failure/default.

Depository Liability
 90 
Does the depository accept liability (independent of any insurance coverage) for the following:



90a. Reconciliation errors with the registrar and/or issuer? clear radio button selections
No
Not applicable
Yes  - then answer 90b
Other  - then answer 90q


90b. If yes, please check all of the following that apply:
Financial limits are imposed on the amount of liability assumed by the depository
The depository assumes liability for direct losses
The depository assumes liability for indirect or consequential losses
Other  - then answer 90y


90y. If other, please explain:




90q. If other, please explain:




90c. Theft of securities (either physical certificate or electronically from accounts at the depository) from the depository? clear radio button selections
No
Yes  - then answer 90d
Not applicable.
Other  - then answer 90r


90d. If yes, please check all of the following that apply:
Financial limits are imposed on the amount of liability assumed by the depository
The depository assumes liability for direct losses
The depository assumes liability for indirect or consequential losses
Other  - then answer 90z


90z. If other, please explain:




90r. If other, please explain:




90e. Failure of the depository’s systems that result in direct damages or losses to participants because they cannot use either securities or funds? clear radio button selections
No
Yes  - then answer 90f
Not applicable.
Other  - then answer 90s


90f. If yes, please check all of the following that apply:
Financial limits are imposed on the amount of liability assumed by the depository
The depository assumes liability for direct losses
The depository assumes liability for indirect or consequential losses
Other  - then answer 90{


90{. If other, please explain:




90s. If other, please explain:




90g. Any loss caused by the depository due to errors, omissions or fraud that cause direct damages or losses to participants? clear radio button selections
No
Yes  - then answer 90h
Not applicable.
Other  - then answer 90t


90h. If yes, please check all of the following that apply:
Financial limits are imposed on the amount of liability assumed by the depository
The depository assumes liability for direct losses
The depository assumes liability for indirect or consequential losses
Other  - then answer 90|


90|. If other, please explain:




90t. If other, please explain:




90i. The depository acting as the central counterparty? clear radio button selections
No
Not applicable
Yes  - then answer 90j
Other  - then answer 90u


90j. If yes, please check all of the following that apply:
Financial limits are imposed on the amount of liability assumed by the depository
The depository assumes liability for direct losses
The depository assumes liability for indirect or consequential losses
Other  - then answer 90}


90}. If other, please explain:




90k. Does the depository guaranty settlement? clear radio button selections
No
Yes  - then answer 90l
Not applicable.
Other  - then answer 90v


90l. Please explain how this is accomplished. What are the procedures and safeguards that permit the depository to guaranty settlement?
KELER acts as central counterparty and guarantees settlement of Exchange trades through novation. The guarantee is supported by individual margins of clearing members, collective guarantee funds, and KELER's equity capital.



90v. If other, please explain:




90u. If other, please explain:




90m. Force majeure events, acts of God, or political events, etc.? clear radio button selections
No
Yes  - then answer 90n
Not applicable.
Other  - then answer 90w


90n. If yes, please check all of the following that apply:
Financial limits are imposed on the amount of liability assumed by the depository
The depository assumes liability for direct losses
The depository assumes liability for indirect or consequential losses
Other  - then answer 90~


90~. If other, please explain:




90w. If other, please explain:




90o. In all cases where the depository assumes responsibility for direct or indirect or consequential losses, is the depository’s liability limited by a standard of care determination? clear radio button selections
No
Yes  - then answer 90p
Not applicable
Other  - then answer 90x


90p. Please define the standard of care applied:
The depositary shall repair direct pecuniary losses of its customers proved by proper evidence if such damages are attributable to and occured in the operation of the depositary.
The depositary is exempted from liability for any damages, pecuniary losses, lost profit or non-material damages that may occur beyond its operations based upon statutory provisions and/or its General Terms and Conditions.
The depositary shall be relieved of liability if it is able to prove that it has acted in a manner that can generally be expected in the given situation.



90x. If other, please explain:



 91 
Do the depository’s written contracts, rules, or established practices and procedures provide protection against risk of loss of participant assets by the depository in the form of?



91a. Indemnification clear radio button selections
Yes  - then answer 91b
No
Other  - then answer 91b
Not applicable


91b. Please explain:

  - then answer 91i


91i. Please provide details of the relevant sections of the contracts, rules or practices where this information is found.




91c. Insurance clear radio button selections
Yes  - then answer 91d
No
Other  - then answer 91d
Not applicable


91d. Please explain:
Capital Market Act, 2001/CXX
  - then answer 91j


91j. Please provide details of the relevant sections of the contracts, rules or practices where this information is found.
see question 8. Document uploaded.



91e. Acknowledgement of liability for losses caused by depository's own actions. clear radio button selections
Yes  - then answer 91f
No
Other  - then answer 91f
Not applicable


91f. Please explain:
KELER General Terms and Conditions detail rules regarding acknowledgement of liability.
  - then answer 91k


91k. Please provide details of the relevant sections of the contracts, rules or practices where this information is found.




91g. Other clear radio button selections
Yes  - then answer 91h
No


91h. Please explain:

  - then answer 91l


91l. Please provide details of the relevant sections of the contracts, rules or practices where this information is found.



 92 
Is the depository immune from legal action in its own jurisdiction? clear radio button selections

Yes
No
Other  - then answer 92a


92a. If other, please explain:






Security Control
 93 
How do participants receive information (view actual settlement of trades, movement of securities on their accounts, etc.) and see the status of their accounts? (Choose all that apply.)

By direct electronic link
By receipt of physical account holding statements
Other  - then answer 93a
Not applicable


93a. Please explain:



 94 
Do participants have access to affect their holdings, including confirming and affirming trades, movement of securities on their accounts, etc.? clear radio button selections

Yes  - then answer 94a
No
Other. Please explain in 94d.  - then answer 94d
Not applicable


94a. How is access given to participants? (Choose all that apply.)
By direct electronic link  - then answer 94b
Other  - then answer 94c


94b. Please select type of electronic link:
Dial-up modem
Secured, leased, dedicated telephone line
Internet
Fax


94c. Please explain:




94d. If other, please explain:



 95 
Regarding data security:



95a. Are passwords used by participants to access their accounts? clear radio button selections
Yes
No
Not applicable
Other  - then answer 95g


95g. If other, please explain:




95b. Does each user have a unique user ID? clear radio button selections
Yes
No
Not applicable
Other  - then answer 95h


95h. If other, please explain:




95c. Are passwords regularly changed? clear radio button selections
Yes  - then answer 95d
No
Not applicable
Other  - then answer 95i


95d. How often?




95i. If other, please explain:
It is up to the policies and practices of the participants. KELER offers the possibility to change passwords but does not require them to be changed regularly.



95e. Is there a user lock-out after a pre-set number of unsuccessful User ID attempts? clear radio button selections
Yes  - then answer 95f
No
Not applicable
Other  - then answer 95j


95f. How many?
3



95j. If other, please explain:



 96 
Does the depository communicate with other market entities such as stock exchanges, payment systems, clearing houses, etc., by secured linkages? clear radio button selections

Yes  - then answer 96a
No  ›› take you to 98
Not applicable  ›› take you to 98
Other  - then answer 96a


96a. Please explain:
1. Exchange - leased line
2. Payment system - SWIFT



 97 
How does the depository communicate with other market entities?



97a. Stock Exchanges (Choose all that apply.)
Dial-up modem
Secured, leased, dedicated telephone line
Internet
Fax
Paper/other
Not applicable


97b. Payment Systems (Choose all that apply.)
Dial-up modem
Secured, leased, dedicated telephone line
Internet
Fax
Paper/other
Not applicable


97c. Clearing Houses (Choose all that apply.)
Dial-up modem
Secured, leased, dedicated telephone line
Internet
Fax
Paper/other
Not applicable


97d. Are there any other entities? clear radio button selections
Yes  - then answer 97e
No


97e. Please identify:

  - then answer 97f


97f. How does the depository communicate with this/these other market entity/entities? (Choose all that apply.)
Dial-up modem
Secured, leased, dedicated telephone line
Internet
Fax
Paper/other

 98 
How is access to the physical building controlled? (Choose all that apply.)

By guards
By electronic keys/personal ID card
By alarm system
Other  - then answer 98a


98a. Please explain:



 99 
What are the vault security procedures for the safekeeping of physical paper? (Choose all that apply.)

Not applicable; no vault is maintained
Electronic keys/combinations
Dual access control
Visitor logs
Vault counts  - then answer 99a
Intrusion alarms
Fire alarms
Guards
Other  - then answer 99b


99a. Please indicate frequency of vault counts:
Full inventory on a yearly basis. Random check of dedicated units weekly.



99b. Please explain:
cypher lock, swipe card with ID code, fully monitored by CCTV





Participant Default Protections Resulting from a Participant Failure
 100 
If a participant defaults, how is the loss covered? (Choose all that apply?)

Depository insurance covers the loss  - then answer 100a
The depository guaranty fund covers the loss
Loss is shared among participants  - then answer 100b
Other  - then answer 100c
Not applicable


100a. Please explain the process:




100b. Please explain the process of how the loss is shared: (Choose one.) clear radio button selections
Equally, among participants
Pro-rata based on participant's volume
Limited to participants with transactions with failing counterparty
Other  - then answer 100d


100d. If other, please explain:
Loss is shared among participants to the extent of their contributions to the Collective Guarantee Funds, but only if individual collateral of the defaulting participant is insufficient to cover losses. KELER also contributes to the Collective Guarantee Funds.



100c. Please explain:
All guarantee elements (individual collaterals, collective guarantee funds, KELER's own capital) apply to CCP guaranteed Exchange transactions only.


 101 
During the past three years, has there been a situation where a participant defaulted which resulted in a significant loss? clear radio button selections

Yes  - then answer 101a
No
Not applicable
Other  - then answer 101a


101a. How was the situation resolved? Or if you answered "Other," then please explain:



 102 
Does the depository have a guaranty fund independent of stock exchange or other market guarantees? clear radio button selections

Yes  - then answer 102a
No  ›› take you to 103
Not applicable  ›› take you to 103
Other  - then answer 102l


102a. If yes, please respond to the following questions:

What is the size of the fund?

The size of the cash market fund is approximately USD 9 million.
The size of the derivatives market fund is approximately USD 1,4 million.
  - then answer 102b


102b. How is the size of the fund determined? (Choose one.) clear radio button selections
By participant volume
By asset value
A fixed amount
Other  - then answer 102f


102f. If other, please explain:




102c. How is the fund financed? (Choose one.) clear radio button selections
Contributions from owners  - then answer 102g
Contributions from participants  - then answer 102h
Funding from retained earnings
Other  - then answer 102i


102g. If so, what is the amount or percentage per owner?




102h. If so, what is the amount or percentage per participant?
Contributions to the cash market fund equals 2,5% of the average turnover in equities during the previous 10 weeks and/or 3% of the average value of open positions in debt securities during the previous 4 weeks. The minimum aggregate contribution is 1 million HUF while the maximum is 125 million HUF.
Contributions to the derivatives market fund equals 5% of the average derivatives initial margin requirement during the previous 3 months. The minimum contribution is 2,5 million HUF while the maximum is 20 million HUF.






102i. If other, please explain:




102d. Who is covered by the fund? (Choose all that apply.)
Direct depository participants only
The beneficial owner also
Other  - then answer 102j


102j. If other, please explain:
Direct Clearing Members



102e. When is the guaranty fund used? (Choose all that apply.)
When a broker defaults
When a direct participant defaults
Other  - then answer 102k


102k. If other, please explain:
When a direct clearing member default cannot be covered by the member's individual collateral.



102l. If other, please explain:



 103 
Does the depository have forms of oversight management for assessing and monitoring of the following? (Choose all that apply.)

Participant eligibility requirements
Participant volumes
Participant financial strength
Other loss or default protections the depository maintains  - then answer 103a
Collateral requirements for participants  - then answer 103b
Debit caps for participants  - then answer 103c
Settlement controls that minimize or eliminate the risk of default by a participant  - then answer 103d
Blocking of securities movement before receipt of payment
Blocking payment until securities are moved
Other forms of risk management used for assessing and monitoring participant exposures  - then answer 103e
Not applicable


103a. Please explain other loss or default protections:




103b. Please explain the requirements:
The four-component guarantee system:(i) basic collateral, (ii) variation margin to cover previous price movements, (iii) initial margin to cover the risk of future price changes, and (iv) additional margin.



103c. Please explain how these debit caps work:




103d. What type or types of settlement controls (Choose all that apply.)
Blocking or freezing of securities positions  - then answer 103f
Controlling DVP settlement  - then answer 103g
Simultaneous DVP  - then answer 103h
Other  - then answer 103i


103f. Please explain:




103g. Please explain:




103h. Please explain:
Multilateral netted positions (Exchanges trades) are settled on a DVP basis in batch processing other DVP transactions are executed in real-time environment on a gross basis.



103i. Please identify and explain:




103e. Please explain briefly how these work:



 104 
Does the stock exchange have default protections that extend to the depository, such as the following? (Choose all that apply.)

Margin requirements for stock exchange members
Guaranty fund for stock exchange members
Financial requirements for stock exchange membership
Other  - then answer 104a
No
Not applicable


104a. Please explain:





BUSINESS RECOVERY PLAN
This section is intended to identify key aspects of the depository’s Business Recovery Plan ("BRP"), including testing requirements and past results, expected recovery time periods, and the independent review and validation (if any) of the BRP.
 105 
Do you have a formal business recovery plan? clear radio button selections

Yes  - then answer 105a
No
Other  - then answer 105g


105a. Does your Business Recovery Plan include: (Choose all that apply.)
Back-up of all computer files
Off-site data storage
Back-up files stored and locked
Off-site operations facility
Other  - then answer 105h


105b. Please identify both the frequency of testing and the last date of testing for the following third Party:

Depository Participants/Members

no third party testing



105c. Please identify both the frequency of testing and the last date of testing for the following third Party:

Stock Exchange

no third party testing



105d. Please identify both the frequency of testing and the last date of testing for the following third Party:

Central Bank

no third party testing



105e. Please identify both the frequency of testing and the last date of testing for the following third Party:

Local Brokers

no third party testing



105f. Please identify both the frequency of testing and the last date of testing for the following third Party:

any Other third Party

no third party testing



105h. If other, please explain:




105g. If other, please explain:



 106 
How quickly can the main system be reactivated in the event of an outage? (Choose one.) clear radio button selections

1 - 4 hours
4 - 8 hours
8 - 24 hours
Longer than 24 hours
Not applicable
Other  - then answer 106a


106a. If other, please explain:
Depends on the situation. This is why there is a back-up a system.


 107 
If a back-up system exists, how quickly can the back-up system be activated in the event of the main system failing? (Choose one.) clear radio button selections

1 - 4 hours
4 - 8 hours
8 - 24 hours
Longer than 24 hours
Not applicable
Other. Please explain in 107a.  - then answer 107a


107a. If other, please explain:



 108 
Will the depository publicly announce any system interruption? clear radio button selections

Yes  - then answer 108a
No  ›› take you to 109
Not applicable
Other  - then answer 108g


108a. To whom will the depository disclose any system interruptions? (Choose all that apply.)
To the depository regulators
To all direct participants
To direct and indirect participants
To the public via the internet  - then answer 108c
In the press  - then answer 108d
Other  - then answer 108e


108b. How will the depository disclose any system interruptions? (Choose all that apply.)
By e-mail
By telephone
Public announcement
Press release
Other  - then answer 108f


108f. Please explain:
KELER's proprietary communication system.



108c. If so, please list webpage address:
   



108d. If so, please list publications:




108e. Please explain:
Budapest Stock Exchange



108g. If other, please explain:



 109 
In the past three years, has it been necessary to activate the recovery plan in a live situation? clear radio button selections

Yes  - then answer 109a
No
Not applicable
Other  - then answer 109d


109a. If yes:

How much time was needed to implement the recovery plan? (Choose one.)
clear radio button selections
Less than 1 hour  - then answer 109b
1 - 2 hours  - then answer 109b
2 - 4 hours  - then answer 109b
Longer than 4 hours  - then answer 109b


109b. How much time was needed to recover and restore business to normal operations? (Choose one.) clear radio button selections
1 - 4 hours  - then answer 109c
4 - 8 hours  - then answer 109c
8 - 24 hours  - then answer 109c
Longer than 24 hours  - then answer 109c


109c. What was the impact to the market? (Choose all that apply.)
All securities settlements took place as scheduled on the same day with good value
All cash settlements took place as scheduled on the same day with good value
All securities settlements took place one business day late with good value
All cash settlements took place one business day late with good value
All securities settlements took place one business day late with value one day late
All cash settlements took place one business day late with value one day late
All securities settlements took place more than one business day late
All cash settlements took place more than one business day late
As a result of the system failure, all fines and penalties for late settlements were waived
Even though there was a system failure, all fines and penalties for late settlements were still assessed
Other  - then answer 109e


109e. If other, please explain:




109d. If other, please explain:





PERFORMANCE, INSURANCE AND LOSS
This section is intended to identify the level of insurance maintained by the depository, and the extent to which coverage would extend to financial loss incurred by participants and their clients, including but not limited to losses resulting from operating performance, security breaches, and employee negligence or misconduct.
 110 
Has there been any material loss by the depository during the past three years? clear radio button selections

Yes  - then answer 110a
No
Other. Please explain in 110b.  - then answer 110b
Not applicable


110a. If there has been a loss, please describe the cause, the final impact and the action taken to prevent a recurrence:




110b. If other, please explain:



 111 
Has the depository been subject to any litigation involving a participant during the past three years? clear radio button selections

Yes  - then answer 111a
No
Other. Please explain in 111b.  - then answer 111b
Not applicable


111a. Please explain the circumstances and resolution:
KELER was plaintiff in a minor case claiming for damages caused in administrative procedures. The case went to the supreme court with a ruling in favor of the depository.



111b. If other, please explain:



 112 
Has the depository realized revenues sufficient to cover expenses during the past three years? (Choose one.) clear radio button selections

Yes for all three years
Yes for two of the last three years
Yes for one of the last three years
None of the last three years
Not applicable
Other  - then answer 112a


112a. If other, please explain:



 113 
Does the depository maintain a reserve for operating losses? clear radio button selections

Yes  - then answer 113a
No
Not applicable
Other  - then answer 113b


113a. Please describe and indicate reserve amount:
On 31 December 2005, retained earnings amounted to approximately USD 45 million.



113b. If other, please explain:



 114 
Has the regulatory body with oversight responsibility for the depository issued public notice that the depository is not in current compliance with any capital, solvency, insurance or similar financial strength requirements imposed by such regulatory body? clear radio button selections

Yes  - then answer 114a
No
Not applicable
Other  - then answer 114f


114a. Please describe:

  - then answer 114b


114b. In the case of such a notice having been issued, has such notice been withdrawn, or, has the remedy of such noncompliance been publicly announced by the depository? clear radio button selections
Yes  - then answer 114c
No  - then answer 114d
Other. Please explain in 114e.  - then answer 114e


114c. If Yes, please describe:




114d. If No, why not?




114e. If other, please explain:




114f. If other, please explain:



 115 
Does the depository have insurance for Default? clear radio button selections

Yes  - then answer 115a
No
Not applicable
Other  - then answer 115c


115a. What is the amount of the coverage?

  - then answer 115b


115b. What is the amount of the deductible?




115c. If other, please explain:



 116 
Does the depository have insurance for Fidelity? clear radio button selections

Yes  - then answer 116a
No
Not applicable
Other  - then answer 116c


116a. What is the amount of the coverage?

  - then answer 116b


116b. What is the amount of the deductible?




116c. If other, please explain:



 117 
Does the depository have insurance for Operational Errors? clear radio button selections

Yes  - then answer 117a
No
Not applicable
Other  - then answer 117c


117a. What is the amount of the coverage?

  - then answer 117b


117b. What is the amount of the deductible?




117c. If other, please explain:



 118 
Does the depository have insurance for Errors and Omissions? clear radio button selections

Yes  - then answer 118a
No
Not applicable
Other  - then answer 118c


118a. What is the amount of the coverage?
Professional Liability Insurance:
HUF 100 Million per event and in the aggregate per annum.
  - then answer 118b


118b. What is the amount of the deductible?
HUF 5 Million each and every loss.



118c. If other, please explain:



 119 
Does the depository have insurance for Computer Fraud? clear radio button selections

Yes  - then answer 119a
No
Not applicable
Other  - then answer 119c


119a. What is the amount of the coverage?

  - then answer 119b


119b. What is the amount of the deductible?




119c. If other, please explain:



 120 
Does the depository have insurance for the Premises? clear radio button selections

Yes  - then answer 120a
No
Not applicable
Other  - then answer 120c


120a. What is the amount of the coverage?
Third party liability insurance including tenants liability.
20 million HUF per incident and 50 million HUF over all.
  - then answer 120b


120b. What is the amount of the deductible?
50 thousand HUF per incident.



120c. If other, please explain:



 121 
Does the depository have any other insurance? clear radio button selections

Yes  - then answer 121a
No
Not applicable
Other  - then answer 121d


121a. If so, what is it for?
1. Property insurance including robbery
2. Employers liability
  - then answer 121b


121b. What is the amount of the coverage?
1. 1´634,8 million HUF aggregate.
2. 10 million HUF per incident and 20 million HUF over all.

  - then answer 121c


121c. What is the amount of the deductible?
1. 0,2-10 million HUF depending on the type of property and type of incident (natural vs. robbery)
2. 50 thousand HUF per incident.



121d. If other, please explain:



 122 
Who is the insurance carrier? If more than one insurance carrier, please list each carrier here and provide your responses to question's 122a and 122b in corresponding order.

Allianz Hungaria Ins. Co.
  - then answer 122a


122a. Who is the insurance carrier's parent company, if applicable? (If inapplicable, simply type n/a.)
Allianz Versicherungs AG, Germany
  - then answer 122b


122b. What is the term of the policy?
1.1.2006. - 31.12.2006. both days inclusive
  - then answer 122c


122c. Who does the insurance cover? (Choose all that apply.)
Depository
Direct depository participants
Final investors
Other  - then answer 122d
Not applicable


122d. If other, please identify:
KELER is the (i) National Depository and (ii) Clearing House. The insurance covers the institution in both capacity.


 123 
If you feel that you would like to provide additional details on any of the given answers, feel free to provide any additional comments here (maximum of 5,000 characters) or prepare an additional document identifying the question(s) you are commenting on and upload the document under 123a:






123a. Upload document here:
   




PUBLIC AVAILABILITY
 124 
The AGC encourages respondents/depositories to make their answers to this questionnaire publicly available. Will you be making your response publicly available? (For additional guidance, please review the help feature to this question.) clear radio button selections

Yes  - then answer 124a
No


124a. If yes, how will you be making it publicly available: (Choose all that apply.)
Web site  - then answer 124b
By individual request with depository  - then answer 124c
Other  - then answer 124i


124b. Please provide web site address of publicly available questionnaire:
http://www.keler.hu/



124c. Please provide name of contact at depository who has been designated to receive such requests.
Mr. Tamás Madlena, Director, Marketing and Customer Relations
  - then answer 124d


124d. How would they prefer to be contacted? (Choose all that apply.)
Telephone  - then answer 124e
Facsimile  - then answer 124f
By mail/air courier  - then answer 124g
By e-mail  - then answer 124h


124e. Please provide telephone number:




124f. Please provide facsimile number:




124g. What is the preferred street address for mailing requests?




124h. What is the preferred e-mail address for such requests:
madlena.tamas@keler.hu; varga.aron@keler.hu



124i. If other, please describe how you will be making the questionnaire publicly available:




124j. Have you updated your contact details on the home page of this questionnaire? If not, please be sure to do so. Simply click on the "Home" button in the right tool bar and it will return you to the home page containing your contact detail information.

You have reached the end of the questionnaire. Please be sure to print your responses and review them prior to submitting your questionnaire. (To print, click on the "Print" button in the right hand tool bar. This will open up a separate window in your web browser. It may take a few moments for the information to load. Once it has loaded, you will be able to scroll through your entire questionnaire and then to print, you must choose the print feature from your web browser. In many cases, this is: "file" then "print." Clicking on the "print" button alone in the questionnaire toolbox will not print the questionnaire.) It is important that you ensure the accuracy of your draft responses before submitting the responses as submission will finalize your response. When you are prepared to submit your answers, please return to this question and select "save" (or in the alternative select "end" from the toolbox) which will then take you to the submission option provided all the necessary questions have been answered.

The members of The Association of Global Custodians thank you for your time and for your helpful response.


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