KEY PROJECTS IN 2022
FURTHER EXPLORING THE MAIN MARKETS
Development of the national FX market and launching of new currency pairs
One of the significant changes in the Russian financial market in 2022 was the increasing interest in national currencies, replacing the US Dollar and Euro. At the beginning of 2022, the share of national currencies in the spot volumes was not more than 1%, but it exceeded one-third by the end of the year. Trading volume of the Chinese Yuan increased by 36 times, Turkish lira by 18 times, Belarusian Ruble by 13 times, and Kazakhstan Tenge by 166 times.
Five new currencies were launched for trading in 2022, such as the Armenian Dram, South African Rand, Uzbekistan Sum, Kyrgyzstan Som, and Tajikistan Somoni. Trading in these new currency pairs on MOEX creates more direct conversion opportunities for banks, brokers, and their individual and legal entity clients, including participants in foreign economic activities. This addition is an important infrastructural element in the advancement of settlements in national currencies.
In 2022, all MOEX markets saw an increase in interest in CNY-denominated instruments.
CNY-denominated bonds of Russian companies were introduced on the Debt Market, with 16 issues launched since August from nine issuers, totaling about CNY 50 billion (nearly RUB 450 billion). In August-December 2022, CNY-denominated bond placements accounted for approximately 20% of the total volume of corporate bond placements. The calculation of the Russian Bond Index denominated in the Yuan was also launched.
On the Money Market, GCC repo, deposits with the CCP, inter-dealer repo and credit market with settlement in the Yuan were rolled out, and the RUSFAR CNY gauge became available.
The Derivatives Market offered CNY/RUB contracts, which soon became some of the most actively traded derivatives contracts. Furthermore, currency swap contracts and deliverable and cash-settled forwards in CNY with terms ranging from three days to one year became available on the Standartised OTC Derivatives Market. In early 2023, the term of transactions in these instruments was extended to five years. The new instruments provide participants of the Standartised OTC Derivatives Market and their clients with an opportunity to hedge currency risk and manage free liquidity in the Chinese Yuan.
A new Debt Market segment for replacement bonds was created. Russian issuers offer these bonds to substitute Eurobonds on the Russian market, with a global certificate at NSD. In 2022, 22 replacement bond issues of eight issuers were placed, with a total volume of around RUB 567 billion. In December, replacement bonds accounted for 20% of corporate bond trading volume. Retail investors have strong demand for replacement bonds, with their share in secondary trading exceeding 60%. This segment is very promising as there are a total of RUB 5 trillion worth of Eurobonds on the market, for which replacement bonds could be issued.
The infrastructure for issuing and trading carbon units was completed in 2022 in Russia. In September 2022, the first on-exchange trades in carbon units were concluded on National Mercantile Exchange (NAMEX). Carbon units are traded in commodity auctions, where the seller of carbon units sets the starting price and buyers bid competitively by increasing the price of their bids.
On-exchange trades ensure transparent and open pricing of the new asset category. The commodity auction technology introduced at NAMEX is the most effective way to quickly bring new types of assets, including unusual ones such as carbon units, to the exchange market.
Other new instruments
The futures and options on the real estate index, sector and government bond indices, NASDAQ, Hang Seng and Euro STOXX 50 indices (with index ETFs as underlying assets), wheat, as well as perpetual currency futures and premium options on the most liquid stocks of Russian companies were launched in the Derivatives Market.
The number of ETFs was increased in response to rapidly growing interest from retail investors. Nine new Russian-law ETFs were launched on the Equity Market in 2022.
The calculation of the on-exchange wheat index was launched, which was the first Russian commodity benchmark to be approved by the Bank of Russia. The index is calculated on the basis of commodity auctions for wheat, which have been run at NAMEX since August 2021.
PROMOTING A CULTURE OF TRUST AND RESPONSIBILITY
In 2022, the Group effectively navigated through a challenging market environment amidst external constraints. The Group ensured the reliable operation of the Exchange’s infrastructure: upon Y2022 results, MOEX key systems availability was measured at 99.99%.
The Exchange continued implementing compliance initiatives in 2022. In April 2022, CCP NCC obtained a certificate of compliance with the international compliance management system standard ISO 37301:2021 Compliance management systems - Requirements with guidance for use. The certificate was issued by Bureau Veritas Certification, JSC following certification audit of CCP NCC.
“Transit 2.0” helps market participants meet the challenges of reducing costs and improving transparency and interaction. “Transit 2.0” meets the demands of a modern multi-banking platform, which is a necessary element for an efficient digital treasury. At the end of 2022, 50 corporations and the largest Russian banks were connected to the Transit 2.0 platform. Currently, 17 banks are available on the platform.
Financial Transaction Registrar (FTR)
The FTR began its work together with the launch of Finuslugi platform. Created on the basis of NSD, the FTR accumulates information on all transactions made on any financial platform. The list of registered products continued to expand in 2022.
MOEX Treasury corporate marketplace
The MOEX Treasury Terminal provides direct access to the Exchange’s markets and services that are essential for the efficient liquidity management. The terminal allows treasurers to convert currencies, deposit funds at market rates against the central counterparty guarantee, trade precious metals and obtain loans, as well as view quotations for hedging instruments in the Derivatives Market and hold deposit auctions to place funds on the M-Deposit Market. The terminal is available in a web-based version, allowing transactions to be made from anywhere in the world through a secure channel. NSD’s Transit 2.0 service is also available through the terminal. An important feature of the MOEX Treasury terminal is the option for non-trading transactions: prompt transfer of funds between markets, withdrawal of funds from accounts, requesting account statements, etc. In 2022, an early withdrawal service was introduced, which allows withdrawing part of the funds placed on deposit and then placing them back at the market rate.
In 2022, above 30 companies connected to the MOEX Treasury terminal; the number of Russian corporations using the MOEX Treasury platform exceeded 100.
Personal finance platform Finuslugi
In 2022, Finuslugi doubled its customer base to more than 1 million people. Finuslugi coves all regions of Russia, both major cities and towns of 5,000 people or more. In 81 cities from 2022, customer identification and access to all platform products is on the same day.
During the year, five banks and four insurance companies joined Finuslugi, bringing the total number of banks to 19 and insurance companies to 17. In addition, there are offers from 150 banks and 150 insurance companies on the marketplace.
New loan services were added to the platform: a loan calculator, a credit rating, a common loan application on the website and in the Finuslugi app, and a credit history service. In partnership with banks, exclusive deposits were launched. An additional issue of Kaliningrad People’s Bonds took place and work continues on launching bonds from other issuers.
For customer convenience, registration in the personal account of Finuslugi was built into the process of purchasing compulsory car insurance (OSAGO), and each customer now has automatic access to this personal account.
A mobile application has been launched, with all the functionality of the website available.