What are the modes of access to TREPS Dealing System?
How is borrowing limit computed?
Are all securities accepted as collateral for computation of borrowing limit?
What is utilization of borrowing limit?
How can a member deposit security/ies towards Tri party Repo?
42.Can a member withdraw / substitute the securities that have been deposited as Collateral?
Can one withdraw securities debited towards Triparty Repo borrowing?Can one withdraw securities debited towards Triparty Repo borrowing? Can one withdraw securities debited towards Triparty Repo borrowing?
Can the Lender withdraw the securities received under Triparty Repo?
Who will get the interest on Securities contributed towards Tri party Repo collateral?
Will there be a separate Default Fund for Tri party Repo? Will there be a separate Default Fund for Tri party Repo?
What is the mark to market margin?
How Mark to Market margin is computed? How Mark to Market margin is computed?
How are MTM rates computed?
How is Intraday MTM Margin computed and collected for this segment?
What is Mark-to-Market Shortfall? What is Mark-to-Market Shortfall?
Does CRR need to be maintained on the borrowing under Triparty Repo?
Will members receive SLR benefit on securities received under Triparty Repo?
Where are the reports made available for Triparty Repo?
What is a Tri party Repo?
In terms of the Repurchase Transactions (Repo) (Reserve Bank) Directions, 2018 dated 24th July, 2018 "Tri-party repo" means a repo contract where a third entity (apart from the borrower and lender), called a Tri-Party Agent, acts as an intermediary between the two parties to the repo to facilitate services like collateral selection, payment and settlement, custody and management during the life of the transaction.
2. What does Triparty Repo facilitate?
Triparty Repo i.e. TREPS facilitates, borrowing and lending of funds, in Triparty Repo arrangement. CCIL would be the Central Counterparty to all trades from Tri Party Repo Dealing System (TREPS) and would also perform the role and responsibilities of Triparty Repo Agent, in terms of Repurchase Transactions (Repo) (Reserve Bank) Directions, 2018 as amended from time to time.
3. Which type of entities are eligible for participating in Triparty Repo?
All the repo eligible entities are entitled to participate in Triparty Repo. The entity type admitted include, Public Sector Banks, Private Banks, Foreign Banks, Co-operative Banks, Financial Institutions, Insurance Companies, Mutual Funds, Primary Dealers, Bank cum Primary Dealers, NBFCs, Corporates, Provident/ Pension Funds, Payment Banks, Small Finance Banks, etc.
4. How can one obtain Membership and participate in Triparty Repo?
Eligible entities, desirous of participating in Triparty Repo, need to apply for Membership of ‘The Clearing Corporation of India Ltd. (CCIL)’s Securities Segment and Triparty Repo (Dealing) Segment of Clearcorp Dealing Systems (India) Ltd (CCDS). The membership application forms in prescribed format may be submitted separately along with two cheques of Rs 25,000/- each (plus applicable GST) favoring “The Clearing Corporation of India Limited” (CCIL) and “ClearCorp Dealing Systems (India) Limited” (CCDS), towards one time membership fee.
5. How can a member access the Tri party Repo Dealing System of CCDS ?
6. How can one obtain Associate Membership of CCIL for Triparty Repo?
Eligible entities, desirous of participating in Triparty Repo, need to apply for Associate Membership of ‘The Clearing Corporation of India Ltd. (CCIL)’s Securities Segment and Triparty Repo (dealing) Segment of Clearcorp Dealing Systems (India) Ltd (CCDS). The membership application forms in prescribed format may be submitted separately along with two cheques of Rs 25,000/- each ( plus applicable GST) favoring “The Clearing Corporation of India Limited” (CCIL) and “ClearCorp Dealing Systems (India) Limited”(CCDS), towards one time membership fee.
Upon approval of membership, by CCIL and CCDS, the concerned associate member is required to execute documents like Power of Attorney, mandate, etc. in the prescribed formats and submit the same to CCIL and CCDS. After completion of documentation formalities the member need to deposit minimum prescribed collateral. Thereafter members can undertake Triparty Repo transactions through the Dealing System offered by CCDS which would be settled through CCIL.
8. What is TREPS Dealing System?
TREPS Dealing System is an anonymous order matching System provided by CCDS to enable Members to borrow and lend funds. It also disseminates online information regarding deals concluded, volumes, rate etc., and such other notifications as relevant to borrowing and lending under Triparty Repo by the members.
What are dealing hours of TREPS Dealing System?
What are the IT infrastructure requirements for TREPS Dealing System?
When can one start using the TREPS Dealing System?
Upon completion of documentation formalities and submission of minimum collateral, an Entity shall be provided access to the TREPS Dealing System. An approved entity shall be provided a Member ID, Member Number and two User names which are unique within the member. The Member may request for customized User names and on receiving in appropriate format, the same shall be created by CCDS. The User can access the TREPS Dealing System by logging in with User name (ID) and password communicated to him. The system would, as a part of the password policy implemented by CCDS / CCIL, prompt the user to change the password immediately on his logging in to the system.
12. Who issues the Digital Signature Certificates?
Associate members access the TREPS dealing system through Internet, with the help of the Digital Signature Certificate. The Associate Member has to arrange for obtaining such Digital Signature Certificate immediately after completing membership formalities and submit the details it to CCDS for configuration.
13. What are the modes of access to TREPS Dealing System?
Members can access TREPS Dealing System through INFINET connectivity whereas Associate Members can access TREPS Dealing System through internet.
14. What is the minimum and multiple order lot size in Triparty Repo?
The minimum lot size is the order size quantity, below which system would not accept orders and multiple lot size is the lot size in which the system would accept orders, if the orders are above the minimum lot size. The minimum and multiple lot size for borrowing and lending under Triparty Repo is Rs.5 lakhs.
15. What is meant by Single Order Limit (SOL)?
Single Order Limit is the maximum order size that can be entered by a User within a member.
16. What are the tenors for which borrowing and/ or lending can be done in Triparty Repo?
Currently the borrowing/ lending is facilitated for tenors upto next 7 days and for three months end dates. A member can request for making available of a particular tenor up to a period of 365 days, by requesting in the format available in sub menu of Request forms under TREPS.
17. What are the settlement types that borrowings and/ or lending can be done in Triparty Repo?
The borrowing and/ or lending can be done for settlement type
18. What is a TREP ID?
TREP ID indicates the 2nd leg repayment date of the Tri party Repo trade. e.g.
TREP010119 means the trade is due for repayment (2nd leg) on 01st January 2019.
19. What are the Dealing and Settlement charges payable for Triparty Repo?
The Trading and Settlement charges payable by member/s for Triparty Repo to CCDS and CCIL respectively, are detailed in notifications issued in this regard.
20. What would be the status of the outstanding orders when a member logs out from the system?
When a Member logs off from the system, the member is given an option to either cancel all outstanding orders or to retain the orders in the system.
21. What happens to the outstanding orders if the PC on which TREPS Dealer Terminal is installed abruptly shuts down? The outstanding orders of the dealer, if any, remains in the order book.
22. Is a member required to manually initiate the generation of Deal Tickets?
Deal Tickets are automatically generated by the TREPS Dealing system after every trade and a hard copy is printed by the printer configured to the PC.
23. Can a member generate a particular deal ticket more than once? A member can reprint a deal ticket any number of times by selecting the particular trade in the Previous Trades Query and clicking on PRINT. Members can also generate a summary report of all his trades by loading the Previous Trades Query and clicking PRINT.
24. What are CSV reports? When are they generated? Where can they be saved?
CSV stands for Comma Separated Value. A .CSV is generated every time a print command is triggered for a Deal ticket or any report from Dealer Work Station (DWS). A .CSV is generated when a deal ticket is automatically printed on conclusion of a trade. .CSVs is normally stored in the C drive of the PC wherein the DWS is logged in. However, facility is provided on the Dealer Work Station for members to configure the path to any folder in a common drive and once configured, all .CSVs will get stored automatically in the designated folder.
25. Can deals be uploaded from TREPS Dealing System in to the proprietary system of the Member?
Deals done on TREPS Dealing System cannot be directly uploaded in to the proprietary system of the Member from the database. The .CSVs are provided to Members precisely for this purpose. The .CSVs saved in the Member’s a folder in local or common drive can be utilised by the Member to upload in to their proprietary system through a utility developed at Member end for converting the .CSVs in to formats compatible with the formats in the Member’s proprietary system.
26. Can a member view its limits i.e. Initial Margin and Borrow Limit on the TREPS Dealing System?
Yes. Members can view their Available Total Limits for the day, i.e., Available Initial Margin and Available Borrowing Limit on the TREPS Dealing System, in the ‘Check Limits’ screen under ‘Basic Data Query’. The member can also view his limit utilization after every trade and the updated status of his balance limit. Also, in case of intra-day deposits and withdrawals of collaterals the trading limits displayed in the screen are updated accordingly.
27. When does a member get deactivated on the TREPS Dealing system?
A member gets deactivated on the TREPS Dealing system automatically when the Initial Margin / Borrowing Limit available for TREPS is fully utilised.
28. Can a Member who has fully utilised his limits during trading, deposit additional margin intra day to trade further?
Yes, a member can deposit additional margin intra-day and subsequently place orders further.
29. Can a Member square off the borrowing / lending position?
Yes. The members can square off their borrowing against lending and vice a versa by an opposite trade in the same TREP id.
30. How is the first leg consideration amount for the deal computed?
The consideration amount for the deal is computed based on the interest rate at which the deal is concluded as per the following formula. 1st leg Consideration amount = 2nd leg consideration/(1+ (interest rate/36500)* tenor in days)
31. What is initial margin (IM)?
Initial margin constitutes the margin obligation required to be fulfilled by a Member in respect of its each Tri party Repo borrow and / or lend order. Members have to deposit initial margin in the form of cash or securities, in advance, before putting up any borrow and / or lend order. Presently members are required to deposit upfront a minimum cash of Rs.1,00,000 towards Initial Margin. Any additional requirement may be met from surplus available in securities deposited towards Borrowing Limit.
32. How is Initial Margin computed?
Initial margin is charged at a rate notified to the members from time to time on the 2nd leg consideration of the order in concerned TREP ID. While arriving at the net outstanding for each TREP ID, offset is allowed between Borrow and Lend trades on FIFO basis and if there is any interest loss due to such offset, such loss is recovered as Initial Margin.
33. How can a member contribute to Initial Margin?
Cash contribution towards Triparty Repo collateral shall be reckoned for Initial Margin. Please refer to the collateral work flow process notified for deposit and withdrawal of Cash and Securities towards Triparty Repo Collateral.
34. Can a Member deposit securities towards Initial Margin requirement?
Yes. A member has to deposit a minimum cash of Rs.1 lakh towards Initial Margin. Members may over and above the minimum cash, contribute eligible securities towards Borrowing Limit (BL). Once available cash is utilized towards Initial Margin then the available Borrowing Limit shall be reckoned for Initial Margin requirement.
35. How much Initial Margin is to be contributed by the members?
Members are required to deposit a minimum of Rs.1 lakh towards Initial margin. The minimum Initial margin deposit has to be strictly in cash only. Over and above this the Members/Associate members are required to deposit initial margin in advance at the rate notified by CCIL of their traded and outstanding order amount.
36. Are members entitled to receive interest on the cash deposited towards Initial Margin?
Members are entitled to receive interest on eligible cash collateral as provided in Triparty Repo Collateral Chapter of Securities Segment Regulations and at a rate notified by CCIL.
37. What is borrowing limit?
Borrowing limit is a limit given to a member against the value of collateral deposited by them, net of haircut, to enable them to borrow funds using Tri party Repo dealing System.
38. How is borrowing limit computed?
The eligible securities deposited by a member as collateral towards borrowing limit as Triparty Repo Collateral are subjected to a valuation exercise at the end of each business day. The valuation is carried out using CCIL’s mark-to-mark price for such securities. Aggregate value of securities contributed by a member, net of haircut, rounded downwards to the nearest rupee is set as permissible borrowing limit for such member. Any security deposited during the day as collateral towards borrowing limit is also revalued at last available MTM price of the security and such a value, net of haircut, is made available as Borrowing Limit. Value of any security withdrawn during the day is reduced from the available borrowing limit. Apart from the end of the day valuation, CCIL undertakes such valuation on multiple times during the day also.
39. Are all securities accepted as collateral for computation of borrowing limit?
CCIL periodically prescribes a list of h securities eligible for contributions as collateral by members.
40. What is utilization of borrowing limit?
Borrowing under Tri party Repo results in utilization of borrowing limit. The utilized portion of the borrowing limit of a member at the end of a day would be equal to the aggregate of the outstanding Triparty Repo borrowings by such member. Securities covering the face value of the outstanding Triparty Repo borrowings are debited to the borrower’s gilt account with CCIL and credited to lender’s gilt account with CCIL as per the prescribed settlement process.
41. How can a member deposit security/ies towards Tri party Repo?
Members can transfer securities from their SGL Account to CCIL’s designated CSGL Account using value free transfer functionality on RBI’s eKuber System. Associate members shall arrange to transfer the securities from their CSGL Service provider’s CSGL Account to CCIL’s designated CSGL Account. Upon transfer of securities, members shall inform CCIL using the CCIL eNotice System.
42. Can a member withdraw / substitute the securities that have been deposited as Collateral?
Yes. Members can withdraw the securities deposited but not utilized for borrowing and / or Initial margin. Member can also substitute securities that have been deposited as collateral either intra-day or overnight i.e. for next day value. However, the securities identified for debiting to the member’s GILT account with CCIL towards its borrowing immediately after close of trading session shall not be available for substitution on the same day. (Note: Please refer to ‘Collaterals Work Flow Process’ issued in this regard for detailed procedure.)
43. Can one withdraw securities debited towards Triparty Repo borrowing?
No. Securities debited towards Triparty Repo borrowing cannot be withdrawn on T+0 basis by the Member. The T+0 Withdrawal Request for such securities will be rejected by CCIL.
44. Can the Lender withdraw the securities received under Triparty Repo?
The securities received by the Lender in its Gilt account with CCIL, towards Triparty Repo lending cannot be withdrawn.
45. Who will get the interest on Securities contributed towards Tri party Repo collateral?
The interest on securities shall be paid to the member contributing the securities, irrespective of utilization of such securities towards funds borrowing.
46. Will there be a separate Default Fund for Tri party Repo ?
CCIL shall maintain a separate Default Fund viz. TPR-DF for meeting losses arising out of any default by its members from Tri Party Repo trades.
The securities contributed by the members towards Default Fund are valued daily at end of the day. If the value of the securities net of haircuts falls below a threshold level as notified by Clearing Corporation from time to time, members are required to contribute such additional sums to the Default Fund as may be necessary.
For deposit and withdrawal of cash / securities collateral towards Default Fund, members shall be guided by the Collateral Work Process notified and available on CCIL web site.
47. What is the mark to market margin? Mark to Market Margin (MTM) constitutes the margin obligation required to be fulfilled by a member to cover the notional loss in value of its outstanding T+1 trades.
48. How Mark to Market margin is computed? All outstanding T+1 trades of the day are considered for End of the Day MTM margin computation. End of the day MTM rates for various TREP IDs are computed as per process described below. MTM loss on Tri party Repo trades is arrived at after allowing full offset between positions in different TREP IDs. Net loss, if any, is collected as MTM Margin - net MTM gains are ignored. MTM margin applicable on trades is treated as incremental MTM margin payable at EOD debited immediately on assessment of the same at end of the day. In case of a resultant shortfall in margin, Members are required to fund their margin account within stipulated time on the next business day. Failure to do so attract penalty.
49. How are MTM rates computed? CCIL gives primacy to the traded rates. For the TREP IDs traded during a day, weighted average rate of last five trades of the day in the said TREP ID (or of all trades, if number of trades in a TREP ID during the day is less than five) are taken into consideration. Market outliers are ignored for this purpose. In case there is no trade in a TREP ID on a particular day, rate interpolated or extrapolated from trades in TREP IDs of nearby maturities or interest rate in inter-bank market for corresponding tenor is used.
50. How is Intraday MTM Margin computed and collected for this segment? Sudden volatility in interest rates / bond prices during the day may substantially erode the Initial margins / hair cut amount collected from the members. CCIL therefore, everyday at 12.00 noon & 3 PM revalues all outstanding trades of the members as as at the time of computation (including trades outstanding at previous EoD and new trades concluded on the current day) ,using the latest available TREP rates. Collaterals are revalued using the intra-day MTM prices arrived at for computation of intra-day MTM margin in Securities segment. Net MTM loss in the portfolio of a member is computed as sum of net MTM value depletion on outstanding trades and reduction in value of collateral under charge. If the net MTM Loss arrived at as above exceeds a percent (as notified from time to time) of the sum of the haircut value of collateral under charge and the initial margin collected, the difference is collected as intra-day MTM margin.
51.What is Mark-to-Market Shortfall?
The eligible securities deposited as collateral with CCIL for availing borrow limits for Triparty Repo Dealing, are subjected to Mark-to-Market valuation intra day and end of day on a daily basis. When the value of the underlying collateral declines on account of mark-to-market valuation such that utilized Borrow Limits exceeds the available Borrow Limit the difference is construed as mark-to-market shortfall which the Member has to immediately replenish.
52. Does CRR need to be maintained on the borrowing under Triparty Repo?
RBI has made the reserve requirements for Triparty Repo borrowing similar to borrowing in market repo and no CRR is required to be maintained for Triparty Repo borrowings outstanding the books of Member/s. (RBI Notification RBI/2018-19/24 – FMRD.DIRD.01/14.03.038/2018-19 DATED July 24, 2018)
53. Will members receive SLR benefit on securities received under Triparty Repo?
A lender can reckon the securities received by it for Triparty Repo lending for its SLR purposes, provided security is primarily eligible as an SLR security. (RBI Notification RBI/2018-19/24 – FMRD.DIRD.01/14.03.038/2018-19 DATED July 24, 2018)
54. Where are the reports made available for Triparty Repo?
All Triparty Repo reports pertaining to trading, settlement, collateral and Risk Management are made available through the CCIL Report Browser accessible through INFINET and internet.