CISX announces unique OEIC settlement offering Investment Funds

Monday 05 October 2009

The Channel Islands Stock Exchange (CISX) has become the first exchange to provide transaction settlement at Euroclear UK & Ireland for Open Ended Investment Companies (OEICs).

This will become available with effect from 30 November 2009.

The CISX has been trading OEICs since March 2005, and will now be able to offer listed issuers in UK-domiciled (including Guernsey and Jersey) OEIC transaction settlement at Euroclear UK & Ireland for transactions on or outside dealing days.

Euroclear UK & Ireland is the central securities depository for UK, Irish and Channel Island securities and already provides settlement and related services for a wide range of securities traded on the CISX. This coverage is now extended to include open ended investment companies.

“The CISX is the first exchange to make OEIC transactions available for settlement at Euroclear UK & Ireland, which will add immeasurably to the Exchange’s appeal to fund managers and investors alike,” said Tamara Menteshvili, Chief Executive of the CISX.

“Extending settlement of OEIC transactions to the proven capabilities of Euroclear UK & Ireland will revolutionise the open-ended funds sector by enabling investors to redeem and subscribe to shares electronically on or outside normal dealing days.

“The move enhances the efficiency of the settlement process for investors and brings new opportunities, both for the Exchange and the investment business sector within the Channel Islands.

“It will have particular significance for securities with monthly or less frequent dealing days, such as in the open-ended property funds market. It is a further example of the Exchange’s innovative approach to exchange services.”

Yannic Weber, Chief Executive Officer of Euroclear UK & Ireland, stated: “Bringing automation and standardisation to the processing of investment fund transactions is a high priority for Euroclear UK & Ireland. CISX clients will see their processing costs decline, and the risks and errors associated with manual transaction processing will be reduced substantially as a result of electronic settlement of OEIC transactions at Euroclear UK & Ireland. We are delighted for CISX that it is the first exchange to offer this service to its clients.”

Robin Newbould, Director of CISX member-firm Cenkos Channel Islands, said: “Representing the latest example of the Exchange’s innovative approach to services, the introduction of Euroclear UK & Ireland settlement will have particular significance for securities with monthly, or less frequent, dealing days such as open-ended property funds. Being able to settle with other Euroclear UK & Ireland participants so easily will almost certainly make them think of using the secondary market more often, which in turn will lead to improved liquidity.”

Andrew Howat, Managing Director of Capita Financial Group in the Channel Islands, added: “As one of the sponsors of the CISX, we are very encouraged to see another extension of the capabilities of the Exchange. Through offering additional dealing flexibility of this nature coupled with the already well recognised services provided, this can only further enhance the attractiveness for companies seeking a listing. We have followed this development very closely and are delighted to see it come to fruition.”