ICSD (International central securities depository)
An international central securities depository (ICSD) is a central securities depository that settles trades in international securities, such as Eurobonds, and in domestic securities held through links with local CSDs. ICSDs also offer asset servicing, securities lending and collateral management services to their participants.
CSD (Central securities depository)A central securities depository (CSD) is an entity that operates a securities settlement system and provides the initial recording of securities in book-entry form (notary service) or central maintenance of securities accounts at the top tier. In the EU CSDs are authorised under the Central Securities Depositories Regulation (CSDR).
CustodianA custodian is a financial institution, usually a bank, that holds securities and cash on behalf of clients, settles their trades and services the assets through corporate actions, income collection, tax relief and reporting. A global custodian covers many markets through its own branches or a network of sub-custodians.
Tri-party collateralTri-party collateral management is a service in which a third-party agent, usually an international central securities depository (ICSD) or a custodian bank, selects, values, substitutes and margins collateral between two parties under agreed eligibility rules. It is widely used for repo and securities lending and lowers the operational work for both sides.
BondA bond is a debt security in which the issuer borrows from investors and promises to pay interest (coupons) and repay the principal at maturity. Key features are issuer, currency, coupon type (fixed, floating or zero), maturity, seniority and any embedded options; bonds are issued by governments, banks and companies.
Asset servicingAsset servicing is the set of services an intermediary provides on securities it holds for clients after settlement: corporate actions, income collection, tax relief, proxy voting, class actions and reporting. It is usually sold together with custody, fund administration or depositary services.
Securities lendingSecurities lending is the temporary transfer of securities from a lender, often a fund or pension scheme, to a borrower that returns equivalent securities later and pays a fee. The borrower gives collateral (cash or securities) above the loan value; lenders keep the economic benefit of income through manufactured payments.
Collateral managementCollateral management is the set of activities to give, take and monitor assets that secure an exposure: agreeing eligibility and haircuts, valuing positions, calling and paying margin, substituting assets and settling movements. Collateral optimisation chooses the cheapest eligible assets to deliver across obligations.