Annual report 2016

Strategic priorities 2015-2020

Key objectives of the Group’s Strategy for 2015–2020

Diversification

Substantially increase revenues from classic infrastructure services and create new trading markets

Key areas of focus

  • Market data and information services
  • Technical services
  • Indices
  • Listing
  • OTC derivatives clearing
  • On-exchange trading of standardised products

Projects completed in 2016

  • Deliverable futures contracts launched for USD/RUB, EUR/RUB and CNY/RUB currency pairs.
  • CHF/RUB trades launched on the FX Market.
  • MICEX and RTS indices for mid- and small-cap stocks introduced.
  • First RTS ETF trading started on MOEX.
  • New types of OTC contracts with the central counterparty (CCP) introduced, including FX swaps, FX forwards and interest rate swaps.
  • Trading in Eurobonds switched to partial depositing and deferred settlement schemes.
  • Trades in RUONIA futures launched.
  • Premium segment created in the Innovation and Investment Market (IIM-Prime).
Optimisation

Improve operational efficiency and streamline Group’s business processes

Key areas of focus

  • Strengthening corporate culture
  • Optimisation and harmonisation of business processes
  • Improving the customer experience
  • Implementation of a cost savings programme
  • Tariff optimisation

Projects completed in 2016

  • IT systems migrated to the new data centre, with the quality of services and access to MOEX markets improved.
  • Shared client registration introduced across all MOEX markets to streamline market access for clients.
  • Derivative market tariff reform completed to align tariffs and fees across MOEX markets and harmonise fees within derivative contract groups.
  • Batch client registration introduced on the FX Market and Equity & Bond Market enabling clients to start trading on the registration date.
  • Updated MOEX values implemented.
  • Procurement function restructured with RUB 734 m in cost savings achieved.
  • New budget planning system introduced to have the Group budgeting and OPEX/CAPEX control processes significantly optimised.
Development of risk and collateral management products

Develop an advanced comprehensive system for managing risks, collateral pool and settlements extending to all Group markets

Key areas of focus

  • Development and harmonisation of the risk management system across all markets
  • Unified clearing and settlement pool
  • Single collateral pool and new collateral management services
  • New tripartite post-trading services

Projects completed in 2016

  • Central counterparty (CCP) protection improved with collateral for stress.
  • CCP allocated capital increased by RUB 3 bn to RUB 9.5 bn.
  • Project finalised to enable inter-market cross-default procedures.
  • Migration to the CCP unified accounting system completed.
Deepening the market

Develop the local investor base and facilitate greater liquidity of the Russian financial markets

Key areas of focus

  • Support of the regulator in implementing reforms
  • Development of the local investor base
  • Development of the Bond Market (bondisation)
  • Customisation of Repo and derivatives products
  • Attracting new issuers
  • Implementation of liquidity protection programmes

Projects completed in 2016

  • A new type of securities – general collateral certificates (GCC) – introduced.
  • Asset Manager Ranking launched.
  • Over 200,000 individual investment accounts opened.
  • Shortest-term bonds trading started.
  • Direct access to the FX Market and deposit operations provided to corporate customers.
  • Cooperation agreements made with Chinese exchanges, brokers and depositories.
  • New type of members (auction organisers) introduced to the M-Deposit segment.
Standardisation of Russian infrastructure

Complete upgrade of key elements of the Russian financial market infrastructure in accordance with evolving international standards

Key areas of focus

  • Alignment of local financial market practices with international standards in terms of key aspects relevant for foreign investors
  • Developing the NSD product offering
  • Streamlining of exchange interfaces for market participants and investors in line with best global practices
  • Promoting better corporate governance at Russian companies

Projects completed in 2016

  • The first international clearing members (ICM) entered the MOEX FX Market, including Bank of America, National Association (BANA) and ICBC Standard Bank Plc.
  • MOEX indices and FX fixings found compliant with the IOSCO principles.
  • CME Group and EMTA began using the MOEX fixing for the settlement of RUB FX futures.
  • NSD acted as the Head Depository in the placement of sovereign eurobonds.