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Misr For Central Clearing, Depository & Registry. Corporate Actions Automation to reduce risk Presentation AMEDA conference Alex., April 27 th -29 th 2009. Dr. Tarek Abdel Bary Managing Director. Contents. What is Corporate action means Philosophy of introducing the service

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Misr for central clearing depository registry

Misr For Central Clearing, Depository & Registry

Corporate Actions Automation to reduce risk

Presentation

AMEDA conference

Alex., April 27th -29th 2009

Dr. Tarek Abdel Bary

Managing Director


Contents
Contents

  • What is Corporate action means

  • Philosophy of introducing the service

  • Objective of Introducing the service

  • Types of the corporate actions

    • Cash dividends

    • Underwriting- Public offer- Private offer

    • Capital Increase - stock dividend

    • Capital Decrease

    • Privatization

    • Share swap

  • Managing the corporate actions risk


What is corporate action means
What is Corporate action means

  • Any event initiated by a corporation which impacts its shareholders When a publicly-traded company issues a corporate action, it is initiating a process that will bring actual change to its stock .

  • Corporate actions are typically agreed upon the company's board of directors and authorized by the shareholders.

  • Some examples are stock splits, dividends, mergers and acquisitions, rights issues 


Philosophy of introducing the service
Philosophy of introducing the service

  • MCDR is the sole company in the Egyptian market that provide the clearing, settlement and Depository services of the Egyptian Public traded securities as well as the consequent re-registration process for that reason MCDR has unique possibilities in delivering corporate action services, as well as assisting shareholders in the exercise of their rights.

  • MCDR provides a wide range of services relating to issuers' corporate actions and the exercise of shareholder rights.


Objective of introducing the service
Objective of Introducing the service

  • Best suited automated systems to support the variety of corporate action events

    • Cash & Stock Dividend

    • Capital decrease / increase

      • Coupon Payment

      • Stock Merger & Split

      • Automatic allocation of corporate action benefits to customer accounts based on the real position to obtain their proper rights accurately and on timely manner.

      • Provide investors with different means to cope with their different needs ( cheques – Bank transfer – swift- ….)


Types of the corporate actions
Types of the corporate actions

MCDR represents the issuance company in various corporate actions events which processed through MCDR automated systems:

MCDR Integrated systems

Issuer instruction

Dividends distribution

Underwriting

Public/ Private offer

Capital increase

Stock dividends

Capital Decrease

Privatization

Share swap


Cash dividends process
Cash dividends process

Issuer general `

assembly

Decision

(2) Request of cash dividends

(1)

(3)

(6)

Yes

MCDR/ Aff. And Inf. Dept.

Issuer

Memo of Dividends bank acc

Math and confirm data

(5) Data entry of the request

Data entry of the request

Dividends bank

(7)

No

notification

(5)

Registry Dept.

Accounting Dep.

(4) Cash Dividends memo

(8) Notification with the transfer

(9) permission

Coupon department

shareholders list in the record date

(10) Posting


Cash dividends process1
Cash dividends process

Coupon department

cheques

SWIFT

Bank transfer

Outsight dividends banks (47 branch) covering the sate

Issuing the dividends receipt up on submitted request

Coupon Dep. Front office

Coupon Dep. Back office

Review & check

ID card

Filling the dividends request

Issuing dividends receipt up to L.E. 50,000


Underwriting public offer private offer
Underwriting/ Public offer /Private offer

(3) Verification of shareholders data

Securities Accounting Dept.

Aff. And Inf. Dept.

(5)

(6)

Amendment of issue acc.

issue acc. increase

(2) Request

(4) Capital increase memo + underwriters CD

(7)

Credit client acc.

Issuer

(1)

Issuer general assembly

Decision

A

T

B

T

C

T

Issuer

T


Misr for central clearing depository registry

Capital increase / stock dividend

(4) Capital increase memo

(2) Request of Capital increase

(3)

Securities Accounting Dept.

Aff. And Inf. Dept.

Issuer

Approval of execution

(6)

increase issue account

(5) Initiate capital increase

(1)

Distribution

(9)

Issuer general assembly

Decision

8

A

T

B

T

C

T

Issuer

T

(3) Notification of issuer admission

Registry Dept.

(4) Capital increase memo

(7) preparing shareholders list in the record date

EGX


Misr for central clearing depository registry

Capital Decrease

(4) capital decrease memo

(2) Request

(3)

Issuer

Sec. Acc. Dept.

MCDR-

Aff. And Inf. Dept.

Execution approval letter

(7) Initiate capital decrease

(8) issue account decrease

(1)

Issuer general assembly

Decision

A

T

B

T

C

T

Issue acc.

T

Registry Dept.

(5) capital decrease memo

EGX

(3) Notification

Cash dividend Dept.

(6) preparing shareholders list in the record date

(9) Repatriation Payment


Misr for central clearing depository registry

Privatization

Canceling order

(8)

(1) Give Buying

Brokers

EGX

(2) Register of Client orders

order

Credit Sett. Cash Account

(4) Sending order

(9)

(7) Un sufficient cash

(3)

Securities sett.

MCDR

Clearing Bank

(5) Sending cash balances

(6)

Compare orders with credit cash

Cash Sett.

No

(9)

yes


Misr for central clearing depository registry

Issuer B

C C C

T T T

Issuer A

C C C

T T T

Aff. And Inf. Dept.

Issuer

(1) Request

Share SWAP

(2) Share swap memo

Brokers

EGX

(5) Sending order

Sec.acc.dept

(4) Register of Client orders

Un sufficient balance

(3) Give orders

(6)

Check Balances

Canceling order

(7)

(8)

No

Yes

Share swap sett.


Managing the corporate actions risk
Managing the corporate actions risk

Receipt of Corporate Action information.

corporate action request be executed when the issuer submits the necessary authorized documents (Board of Directors or General assembly meeting decision)

Distribution of Corporate Action information

The issuer should notify the company with all related information accurately and on timely manner .

Receipt of Corporate Action Instructions

MCDR maintain a pro active client files for each Issuer

MCDR has an efficient system of receiving and processing the issuer instructions information.


Managing the corporate actions risk1
Managing the corporate actions risk

Processing of Corporate Action Instructions

All corporate instructions are processed on timely and accurately way to be able to managing the corporate actions effectively

Clear statement of liability

MCDR has the responsibly to compensate any client in the event of an error could result from wrong processing.

Manual processing of the related data be limited to minimum level to reduce the likelihood of error as well as minimizing the potential losses


Misr for central clearing depository registry

Any Question?

Thank you

t.Bary@mcsd.com.eg