Settlement services - Bulgaria
Pre-matching service
The table below summarises CBL's pre-matching service for external settlement instructions, as well as the pre-matching method and start time in the market. For details of CBL's pre-matching services, see Pre-matching services for external settlement instructions.
| Service offered | Method employed | Start (local time) |
| All securities | ||
Immediate Release Flag available | “Manually” via electronic means or telephone | On trade date |
| Connectivity medium | Instruction format |
Xact Web Portal | Tick to enable the “Immediate Release” option. |
Xact via SWIFT and Xact File Transfer | Field :22F::STCO/CEDE/IREL |
Note: For transactions on equities, investment funds, corporate, mortgage and municipal bonds:
- Customers are strongly recommended to use the immediate release flag in their settlement instructions to ensure timely pre-matching of stock exchange trades in the Bulgarian market.
- Customers are required to use the immediate release flag in their settlement instructions to ensure timely settlement of OTC transactions.
Domestic allegement matching service
Where no pre-matching instruction has been sent to the market, CBL accepts allegements via its depository from domestic market counterparties. It will then use these allegement messages to search for the best matching customer instruction.
If no matching customer instruction is found, the allegement is reported to the customer provided that its Clearstream Banking account number is present.
For details of CBL's domestic allegement service, see Pre-matching services for external settlement instructions.
Procedures for domestic counterparties
Customers must advise their domestic counterparties to contact CBL’s depository Eurobank Bulgaria in order to provide trade confirmations and arrange pre-matching of instructions.
Eurobank Bulgaria AD
Custody Services Department
Telephone: +359 2 8166214 / +359 2 8166236
Fax: +359 2 9888191
Email address for trade confirmations: custody@postbank.bg
Settlements Desk:
Mrs Tonya Radeva
Telephone: +359 2 8166236
| Procedure for the domestic counterparty | Deadline |
| Securities that settle in BNB | |
| For receipt and delivery transactions free of payment: Deliver to/receive from: Clearstream Banking SA (BIC: CEDELULL) For/from: Clearstream Banking (BIC: CEDELULL) Account number 9252205700 (client account for BGN denominated bonds), 9257205700 (client account for foreign currency denominated bonds). By order of: Clearstream Banking customer account number XXXXX | Market deadline. According to market practice, pre-matching takes place on trade date. |
| Securities that settle in CDAD | |
| For receipt and delivery transactions free of and against payment: Deliver to/Receive from: Eurobank Bulgaria (BIC: BPBIBGSFSEC) For/from: Clearstream Banking (BIC: CEDELULL) account number CBL300886 (Clearstream Banking account at Eurobank Bulgaria) By order of: Clearstream Banking customer account number XXXXX | Market deadline. According to market practice, pre-matching takes place on trade date. |
Specific settlement rules/settlement restrictions
Government securities - BNB
In accordance with the rules of the BNB system, transactions on behalf of clients of direct participants in the BNB system settle free of payment only. Consequently CBL customers may instruct domestic settlement of government securities free of payment only.
According to the provision of Article 2, paragraph 7 of Ordinance No 5 of the Ministry of Finance and the BNB, only pledge transactions without change of the beneficiary owner for participants in ESROT and with CBL accounts could settle.
Equities, investment funds and corporate, mortgage and municipal bonds - CDAD
Trade date is mandatory in all settlement instructions.
Instructions will not be processed at CDAD and an MT548 cancellation (or settlement status) message will be sent to CBL and forwarded to the customer when the settlement date is in the past.
OTC trading and settlement
In the CDAD system, with respect to against payment OTC transactions, the date on which the instructions of the counterparties actually match is determined as the trade date. Consequently, the settlement of against payment transactions will take place two business days later in accordance with the T+2 settlement cycle. The CBL deadline for against payment OTC transactions is subject to the matching in the CDAD system. If no matching occurs in the domestic market on the trade date, the settlement will be delayed accordingly.
OTC transactions without change of beneficial ownership
In order to benefit from straight-through processing, the customer must complete fields as follows to specify that there is no change of beneficial ownership (the transaction is for a transfer of securities from one custodian to another):
| Xact via SWIFT and Xact File Transfer |
:94B::TRAD//OTCO/OTC |
:22F::BENE//NBEN |
Smallest possible denomination and nominal amounts
Bulgarian government securities may be traded in fractional denominations. For Bulgarian government securities held in CBL, BGN 1, EUR 1 or USD 1 is the smallest possible denomination.
All Bulgarian government securities received or held in CBL and all nominal transaction amounts must be integral multiples of BGN 1, EUR 1 or USD 1.
Bridge settlement
Bulgarian securities are not Bridge-eligible
Back-to-back processing
Back-to-back processing is not available for transactions on Bulgarian securities.
New issues settlement
Equities
Transactions in new issues are settled on the day on which the distribution occurs in the Bulgarian market. For expected settlement result times, please refer to Settlement times.
Government securities
Auctions on Bulgarian government securities are organised by the BNB. Primary dealers in the BNB system place bids for auctions. Customers that want to participate in a primary auction should contact a local primary dealer to place their bid.
The settlement cycle for new issues of Bulgarian government bonds is Auction date + 2. Newly issued securities can be received in CBL free of payment only. Customers that successfully bid for a new government issue must perform the following steps:
1. | Notify their local primary dealer of CBL's direct account. |
2. | Send a receive free of payment settlement instruction to CBL by 15:00 CET SD with the following details: |
| Xact via SWIFT and Xact File Transfer |
:22F::BENE//NBEN |
:95P::PSET//BNBGBGSFXXX |
:95P::DEAG//primary dealer's BIC |
3. | Instruct CBL's CCB for BGN to make a payment of the applicable cash amount to the primary dealer by the deadline as set by the primary dealer (the BNB deadline for receiving the cash amount is 08:00 CET SD). Customers are recommended to mention in their cash instruction the amount of securities acquired, the ISIN code and that the securities were acquired as a result of an auction. |
Fees
Final redemptions on government bonds settled in the BNB system are subject to a special fee levied by the BNB (currently 0.02% of the nominal value). The BNB deducts the fee from the redemption amount. CBL pays the redemption amount to customers net of the BNB fee.
Settlement Discipline Regime and related domestic market settlement functionalities
Recycling of pending transactions
CDAD : Matched instructions are recycled until settlement takes place or a bilateral cancellation is submitted.
Unmatched instructions are recycled for five (5) days and then cancelled.
BNB: Matched instructions are recycled for four (4) days.
Unmatched instructions are not recycled.
Bilateral cancellation
CDAD and BNB: This means that matched instructions can only be cancelled if both domestic counterparties request a cancellation of their instructions.
Until the cancellation confirmation is received from the market, the instruction will remain eligible for settlement, that is, the instruction may be provisioned and proposed for settlement and may be subject to cash penalties.
Hold and release
Not available on the market.
Partial settlement
Not available on the market.
Cash tolerances
With non-EUR currencies, for settlement amounts equivalent to less than or equal to EUR 100,000, the tolerance level will be equivalent to EUR 2, while for settlement amounts that are equivalent to more than EUR 100,000, the tolerance level will be equivalent to EUR 25. For settlement instructions in currencies other than EUR, CSDs should use the official exchange rates of the European Central Bank (ECB), valid on 1 January of the respective calendar year.
For domestic against payment instructions, the maximum discrepancy tolerated in settlement matching varies in accordance with market practice and the conditions of the domestic link.
Matching information
The trade date is a mandatory matching criteria and domestic instructions will follow local market rules.
Cash penalties
CDAD and BNB: Penalties will be calculated and applied on matched settlement instructions that fail to settle, in full or in part, on and after their intended settlement date (ISD), if both the settlement instruction and the relevant financial instrument are subject to cash penalties.
Instruments subject to cash penalties
Any financial instrument listed in the Financial Instruments Reference Data System (FIRDS) database maintained by ESMA will be subject to cash penalties. However, cash penalties will not apply to shares listed in the Short Selling Regulation (SSR) exemption listed in the Short Selling Regulation (SSR) exemption list.