Default management - KASE Clearing Centre

The KASE Clearing Center has a clear action plan to protect all conscientious market participants in case of someone failing to fulfill their obligations. This is called rollover and liquidating the positions.

This is the first step that the KASE Clearing Center is taking to give a clearing participant the opportunity to rectify the situation. A conscientious clearing participant has limited time to settle its obligations on its own. If this does not happen, the KASE Clearing Center intervenes and takes the following actions:

Concluding the transactions on behalf of a participant. Concluding a repo or swap operation on behalf of an unscrupulous clearing participant to cover its unfulfilled obligations.
Bringing instruments from the market. Submitting an order to "Everyone" so that any clearing participant could provide the required financial instrument.
Work with voluntary providers. Concluding a repo operation with a clearing participant who has the required financial instrument and agrees to assist.
Settlement by CCP with a conscientious clearing participant having counterclaims with the current settlement date for the required financial instrument (CCP concludes transactions on behalf of the conscientious clearing participant)

If the rollover did not help and a clearing participant is still unable to fulfill its obligations within the established time, the KASE Clearing Center proceeds to liquidation of positions. This means the final closing of positions to protect the market.

Conclusion of balancing transactions. Conducting a transaction on the market on behalf of an unscrupulous clearing participant in order to close its obligations.
Use of collateral. Any difference in price is covered by the insolvent clearing participant's collateral to cover its obligations. This process occurs in stages:
- margin collateral of an insolvent clearing participant;
- guarantee fee of an insolvent clearing participant;
- reserve fund;
- guarantee fees of conscientious clearing participants.

You can become a voluntary provider and help in settling of defaults. For this, you need to sign a special application that allows the KASE Clearing Center to use your assets (in your client account) to conclude repo operations during rollover

Your benefit? You receive passive income because the rates for such transactions are higher than the market rates.
Process: The KASE Clearing Center concludes a repo operation with you for 1 (one) day, using your assets as collateral. This does not require any additional investment decisions on your part.

By becoming a voluntary provider, you not only receive additional income but also contribute to stability and reliability of the entire financial market.

Application for assignment of the voluntary provider status.