The National Bank of Ethiopia (NBE) has initiated a project aimed at modernizing Ethiopia’s securities infrastructure by introducing a Central Securities Depository (CSD). Montran, a financial technology solutions provider based in the United States, has been contracted by the regulatory body to collaborate on the design and construction of the new CSD system.
A Central Securities Depository serves as the official record keeper for securities ownership and transactions. It utilizes electronic recording to manage securities balances and facilitate the settlement of securities transactions, thereby reducing risks and costs associated with traditional paper-based systems.
The primary objective of the new CSD project is to digitalize post-trade activities within Ethiopia’s capital markets. This initiative aims to enhance the safety and efficiency of trading, clearing, and settlement processes for securities such as equities and bonds. The implementation of the CSD will enable issuers and investors to conduct electronic transactions through a book-entry transfer of securities, eliminating the need for physical delivery of paper certificates.
Montran, leveraging its extensive experience and technology, will be responsible for designing, implementing, and integrating essential infrastructure components. This includes the development of a securities depository module, registry module, transfer agent module, and an integrated risk management system.
Source: Birr Metrics
