Services

Triparty Repo Collateral

Introduction: 

Members of Securities Segment availing clearing and settlement services of CCIL for Tri party Repo trades, are required to contribute securities and funds towards Tri party Repo collateral as per the work flow process notified from time to time. The Tri party Repo collateral contributions in cash are considered as   Initial Margin and eligible security contributions are considered for Borrowing Limit. 

Members of Securities Segment settle their funds obligation at Reserve Bank of India or Designated Settlement Bank (DSB). The collateral work flow process notified and applicable to Members, are where funds are settled and also whether such entity is an SGL account holder or Gilt Account Holder (GAH) and if GAH, then whether the Gilt Account is maintained with DSB or any other CSGL Service provider. 

CCIL introduced Clearing Member structure in its Securities Segment from March, 2020.  In terms of the same eligible members can become Clearing Members for Securities Segment – Tri party Repo. Once the required documentation formalities are completed,  the clearing member can register their constituents for Tri party Repo. The collateral (cash / securities) is received from clearing member and maintained distinctly in name of Clearing Member a/c constituent in CCIL’s records. The initial margin / borrowing limit computation methodology is same for members as well as constituents. 

Composition 

Members / constituents may contribute securities and cash (INR)  towards Tri party Repo collateral.  A Member / constituent admitted to Securities Segment – Tri party Repo  is required to maintain a minimum cash- collateral contribution of Rs. 1 Lac towards as Tri party Repo collateral at all times.  

In respect of Members settling funds obligation at RBI, cash collateral are received in CCIL’s RTGS Settlement Account with RBI. Members settling funds obligation at Settlement Bank are required to credit their cash collateral contributions to CCIL’s  Current Account maintained with the respective Settlement bank(s). Cash towards constituents’ margin is transferred by Clearing Member to CCIL’s account at RBI. 

Security(ies)  contributions towards Triparty Repo, in respect of all members, are received and maintained in CCIL’s dedicated Constituent SGL (CSGL) Account with Public Debt Office, RBI. 

Work Process 

The workflow process for deposit of Cash and Securities towards Triparty Repo Collateral and Triparty Repo Default Fund, is as notified by CCIL from time to time. The workflow process notified by CCIL may be different for Members, settling funds at RBI/Settlement Bank (DSB) and maintaining SGL Account at RBI and also for Associate Members who maintain their current account with DSB and Gilt Account with DSB or other CSGL service provider. 

The securities towards Securities Segment – Tri party Repo are accepted in CCIL’s distinct  Constituent Subsidiary General Ledger account maintained with Public Debt Office of Reserve Bank of India. The securities are transferred from members’ SGL / CSGL account to the above referred CSGL Account of CCIL on a Value Free basis using the eKuber System of Reserve Bank of India. 

The cash is transferred by members to CCIL’s bank account wherein the concerned members settles the funds obligations. Members settling at RBI transfer the cash to CCIL’s RTGS Settlement Account whereas the members transfer the cash contribution to CCIL’s account with respective Settlement bank. 

The refund of securities / cash are effected by CCIL from its CSGL account / RTGS Settlement account with RBI or its funds account with settlement banks.

Members desirous of making cash / securities contributions to Securities – Triparty Repo are required to initiate a value free transfer / funds transfer and intimate CCIL about the same using the eNotice System or a physical notice of deposit (incase of non-availability of eNotice) in a prescribed format within the cut off time prescribed for the purpose. 

Members desirous of making cash / securities withdrawal from   Securities – Triparty Repo are required to initiate a withdrawal request using eNotice System or a physical notice of withdrawal (incase of non-availability of eNotice)   within the cut off time prescribed for the purpose. The securities refund can be effected on the day of notice or Notice + business 1 day as requested by member. All cash withdrawals are on Notice + business 1 day basis. 

CCIL has issued detailed Collateral Work Flow process for Tri party Repo and the same is amended periodically. 

Corporate Actions and Benefits 

All corporate actions on member’s Cash and Securities holdings are remitted to the RTGS Settlement / Current Account of concerned members with separate individual electronic advices to members.

a) Interest Payment on Cash Collaterals 

Interest is paid to members at quarterly rest on maximum daily utilisation of cash collateral maintained by members towards Initial Margin requirement for Triparty Repo transactions.  The minimum threshold contribution as prescribed by CCIL is excluded from such computation of amount eligible for interest. The rate of interest is  as notified by CCIL.  

b) Interest Payment on Securities Collaterals

Periodic coupon payments in respect of Members’ contributions of dated securities are received by CCIL from RBI and passed on to Members contributing such  securities,  through RTGS System of Reserve Bank of India and net banking system(s) of settlement banks. Relative funds are remitted to the RTGS Settlement / Current Account of concerned members with electronic advices to members. The corporate action on securities are paid to the contributor of securities. 

CCIL provides benefit of accrued interest to members in Borrowing Limit contribution. In the event of a shortfall in borrowing limit due to reduction in value of securities on interest payment date, CCIL has right to withhold the interest on securities payable to such members. The interest amount is credited upon receipt of securities from the member towards shortfall replenishment. 

TREPS Collateral – Securities – Redemptions

Redemption proceeds of matured securities / treasury bills are treated as concerned members’ additional cash contribution towards Initial Margin (Securities – Tri party Repo).

List of Eligible Securities

CCIL prescribes a list of securities at periodic interval that are eligible for collateral contributions by members towards Securities Segment – Tri party Repo.  The said list is available under Risk Management tab on our web site. 

Collateral Holding and Transaction Statements 

The Transaction Reports and Holding Reports are available for download by all on CCIL’s Reports Browser. The reports will reflect the position arising out of deposit of securities, credit of securities to lenders gilt account of their lending transactions, withdrawal of securities and debit of securities on account of borrowing.