World first for JSE clearing house

first_img14 December 2012Safcom, South Africa’s clearing house appointed by the Johannesburg Stock Exchange (JSE) to provide services to the local exchange-traded derivatives market, on Thursday became the first in the world to qualify for CPSS-IOSCO compliance.CPSS-IOSCO is a global standard for risk management aimed at any organisation enabling the part of a trade that occurs once an investor gives the “buy” command, namely, clearing, settling and recording the transaction.The risk is that a party to a derivatives contract may default and fail to perform its contractual obligations, causing losses to one or more parties or a third party.Part of global financial stability driveThe standard was designed as part of an international drive towards financial stability in the wake of the 2008-09 global financial crisis.“If clearing houses are ineffective, they could be a transmitter of contagion, financial shocks and default,” the JSE said in a statement on Thursday. “CPSS-IOSCO compliance demands adherence to a comprehensive set of principles designed to enhance investor protection, promote transparency and reduce systemic risk.”Safcom’s achievement is important to derivative traders because Basel III, the global regulatory standard on banking regulations including capital adequacy, imposes prohibitive capital penalties on banks which deal with clearing houses that aren’t IOSCO-compliant.“Failure to comply means banks will have to hold up to 10 times more capital as surety, which will result in the derivatives market becoming increasingly expensive to trade in, further resulting in a decrease in investments,” the JSE explained.Basel III was agreed in 2011, and is scheduled to be introduced from 2013.‘Boost for SA as investment destination’According to the JSE, there is currently R320-billion traded on the derivatives market in South Africa at any time, with R14-billion in initial margins to guarantee settlements.“The JSE believes that the achievement of IOSCO compliance is a major step forward for Safcom, and an important move to enhance the credibility of the South African market ecosystem as a foreign investment destination,” said Leila Fourie, director of post trade services at the JSE.“The appointment of a qualifying clearing house in South Africa enables growth in the derivatives market as we approach the implementation of Basel III.”The achievement was the result of collaboration between the JSE, the country’s banks and Safcom’s other market participants, as well as JSE regulator the Financial Services Board, which reviewed and assessed the compliance activities.‘Next up: IOSCO-compliant OTC offering’Having achieved compliance for clearing in the on-exchange environment, the JSE believes that the next logical step is to work with the market to resolve the need to centrally clear the Over The Counter (OTC) derivatives market.“Internationally, the move is towards OTC derivatives being cleared through a regulated clearing house,” said Fourie. “Having Safcom certified as a qualifying clearing house for exchange-traded derivatives creates a great foundation for the future development of an IOSCO-compliant OTC offering.”Achieving compliance has been a strategic initiative for the JSE as it enhances risk standards, affecting the market credibility and liquidity of the exchange.As part of the compliance, Safcom established an enhanced default fund which further increases protection of investors, while also creating a more equitable line of defence against any possible default event.“In the event of a default or insolvency, Safcom will now absorb the first loss before non-defaulting clearing members. This allows the risk to be spread rather than being carried by the banks alone,” Fourie said.SAinfo reporterlast_img read more

SA, Boeing in titanium technology deal

first_img “Our research and development agreement with the CSIR adds a new dimension to Boeing engagement in South Africa,” said Boeing’s international vice president for Africa, J Miguel Santos. “We are collaborating to leverage expertise and resources to advance South Africa’s development goals and the competitiveness of Boeing products,” Santos said. “Boeing Research and Technology conducts its own research and works with partners around the world to find technologies that are innovative and affordable.” SAinfo reporter 13 June 2013 South Africa’s Council for Scientific and Industrial Research (CSIR) and US aerospace giant Boeing have signed an agreement to collaborate on the research and development of titanium powder for industrial manufacturing processes in the aviation industry. South Africa boasts the second-largest reserves of titanium ore in the world, and the CSIR has developed and patented technology that converts titanium tetrachloride to titanium powder. “This mutually beneficial agreement, bolstered by South Africa’s rich titanium ore reserves, supports the nation’s long-term economic development goals that include the supply of titanium to many industries, including aerospace,” the CSIR said in a statement on Tuesday. The deal cements the titanium beneficiation cooperative research plan agreed on by the two organisations in 2012. “Boeing’s competencies and experience regarding the applications of titanium in aerospace parts and structures will hugely complement the CSIR’s drive towards commercialisation of the titanium technologies,” said Titanium Centre of Competence director, Willie du Preez. The centre of competence is hosted by the CSIR and features collaboration with the national science department, various South African universities, science councils and commercial entities. ‘Significant cost, efficiency advantages’ A titanium pilot plant was launched in Pretoria last week in a partnership between CSIR and the Science and Technology Department and will assist in the up-scaling of the technology and the agreement with Boeing. “It is a breakthrough in the production of titanium metal powder using a novel continuous process, instead of the more conventional batch process,” Science and Technology Minister Derek Hanekom said at the launch of the plant. “This proprietary technology offers significant cost and efficiency advantages and is expected to give South Africa a comparative advantage in the production of titanium metal and finished products.” The success of the pilot plant will drive the commercialisation of the country’s titanium beneficiation strategy and is expected to stimulate development in various sectors.last_img read more

Plea to restore Internet in Darjeeling rejected

first_imgWith Class 9 students being unable to fill up their board examination forms without Internet, the Darjeeling teachers’ association on Monday met the district magistrate and sought restoration of its service, but in vain. The authorities rejected the demand saying they would make special arrangements for students to go to Siliguri to fill up their forms.The authorities have cited persisting law and order problem in the Hills, facing an indefinite shutdown seeking a separate Gorkhaland for the last 40 days. Internet services in the Darjeeling Hills had been suspended on June 18. No violenceMeanwhile, there was no report of any untoward incident from the hill town since Sunday night.GJM supporters took out rallies at the Chowkbazar area demanding Gorkhaland amidst patrolling by police and security forces. Tight vigil was in place at every entry and exit route.Except pharmacies, all other public service installations including shops, restaurants, hotels, schools and colleges have remained closed since imposition of the shutdown.With food supply severely hit due to the shutdown, GJM activists and NGOs were seen distributing food items among the people.According to officials, the State government sealed the Siliguri-based office of a Nepali language satellite television channel alleging that it was promoting unrest. The administration said the channel was promoting enmity between groups and encouraging violence and arson. The allegations were denied by the channel. “The Internet is banned for last 37 days and now this ban on the channel,” GJM supremo Bimal Gurung said.last_img read more

Cyclone ‘Bulbul’: West Bengal govt pegs losses at ₹23,811 cr

first_imgWest Bengal has incurred a loss of ₹23,811 crore in the devastations caused by cyclone Bulbul that has affected around 35 lakh people in three districts, said a report the state government submitted to the visiting central team said on Saturday. The report was handed over to the members of the central team during a meeting with state Chief Secretary Rajiva Sinha at the secretariat and a separate report would be sent to the Centre. Members of the team called on the State government officials on Saturday, a day after they visited the cyclone-hit areas in North & South 24 Parganas and Purba Midnapore districts to assess the extent of damage caused by the storm.“The state has incurred a total loss of ₹23,811 crore in the three districts ravaged by cyclone Bulbul where over 35 lakhs of people have been directly affected. A total of 5,17,535 houses were damaged in the cyclone,” a senior official said, quoting from the report. Altogether 14,89,924 hectare of agricultural land have been damaged, it said adding that the power department has incurred a loss of ₹597 crore. As many as 4,35,000 tarpaulin and 6.2 lakh water pouches have been distributed by the state Public Health Engineering department, the report said.“Reports on losses incurred in North and South 24 Parganas and East Medinipur districts due to the storm and requirement in those areas were handed over to the central team. We would submit a separate report to the Centre,” the IAS officer said. The central team have made ground visits, conducted aerial surveys of the affected areas and met officials of the three affected officials.“We visited the areas affected by the cyclone to assess the extent of devastation. We have spoken to all the people concerned,” a member of the central team said.“We have taken note of what we have gathered from our meetings in these districts. We will now submit a report to the central government,” he said. The team members included joint secretary of Ministry of Home Affairs K.B. Singh, assistant director of department of expenditure under the Union finance ministry Sumit Agarwal, director of department of agriculture Narendra Kumar and deputy director of Union Power Ministry O.P. Suman. Cyclone Bulbul had made landfall late on November 9 between Sagar Islands in West Bengal and Khepupara in Bangladesh. Altogether 14 people, including fishermen of a capsized trawler, died in the calamity. West Bengal Chief Minister Mamata Banerjee had earlier welcomed the visit of the team to the cyclone-hit areas. After conducting an aerial survey of the cyclone-hit areas, she had said on Wednesday that the loss incurred by the state due to the catastrophe might go up to ₹50,000 crore.last_img read more

Tibet bus accident kills 44 people, injures 11

first_imgAt least 44 people were killed and and 11 others injured in China today when a tour bus plunged into a Tibetan valley after a three-vehicle pile-up.”The 55-seat bus carrying 50 people fell off a 10-metre-plus-high cliff after crashing into a sports utility vehicle and a pick-up truck,” state-run Xinhua news agency reported.Another five people were in the other vehicles in the accident which happened at around 4:25 pm (0825 GMT) in Nyemo County, west of the capital Lhasa, in the Tibet Autonomous Region.The bus passengers were mainly tourists from regions including Anhui, Shanghai, Shandong and Hebei.The injured were being treated at hospitals in Lhasa and did not have life-threatening injuries, Xinhua said. An investigation into the cause of the accident is under way.Police have detained managers of the Feixiang Travel Agency and the Shengdi Vehicle Tour Company blamed for the accident.last_img read more