Terms and Conditions for Granting and Repayment of Intraday Credit in Euro (hereinafter referred to as the Terms and Conditions )

Transcription

1 Appendix no. 2 to the Agreement on Terms and Conditions for the Opening and Operation of RTGS Account in SORBNET-EURO System Terms and Conditions for Granting and Repayment of Intraday Credit in Euro (hereinafter referred to as the Terms and Conditions ) Paragraph 1. Definitions For the purposes of these Terms and Conditions the terms listed below shall mean : - MTS CeTO S.A.. a company operating the MTS Poland market i.e.the electronic market of Treasury Securities (T-securities), where trading with these securities takes place - fixing actions taken in order to set Fixing Rates and purchase /sale Information Rates of T-securities, in accordance with the Rules for Fixing T-securities ;The above mentioned Rules are available on the NBP s website ( - bonds Treasury bonds deposited with the National Depository of Securities, hereinafter referred to as the NDS, subject to fixing at MTS CeTO S.A., - direct participant of NDS - a participant with the deposit account and securities account maintained by the NDS, - Application a request in writing for granting the intraday credit in euro, the document submitted to the NBP drawn up in accordance with the template constituting Attachment no. 1 to Appendix no. 2 to this Agreement, - ISIN code International Securities Identification Number which is assigned by the NDS and compliant with the rules of the Assotiation of National Numbering Agencies. - participant the SORBNET-EURO Participant which is being a domestic bank or a branch of foreign bank or a branch of credit institution Paragraph 2. General Provisions 1. The NBP shall extend the intraday credit in euro to the participant, secured by the way of transferring the rights from bonds on the terms and conditions stipulated herein and in this Agreement.

2 2. The NBP shall extend the intraday credit in euro on each operational day via transferring funds to the participant s account after the participant provides the required collateral. 3. The participant declares to be the owner of the bonds securing repayment of the intraday credit in euro and the rights arising thereof, and are not encumbered with any rights in favour of a third party and also that trading them is not subject to any restrictions. 4. The participant authorises the NBP to debit its account with: 1) the repayment of the intraday credit in euro, 2) the placed order relating to the reduction of the collateral, reffered to in Para. 5, section 3, 3) the servicing costs referred to in Para.3, section 6, 4) the interest reffered to in Para.11, section 9 & section 10 of this Agreement. Paragraph 3. Limiting the Intraday Credit in Euro 1. The maximum amount of the intraday credit in euro shall be fixed by the NBP for a relevant calendar quarter on the basis of the Application submitted by the participant. 2. The participant shall submit the Application to the NBP for the subsequent quarter not later than by the 20th day of the calendar month ending the elapsing calendar quarter. A failure to submit the Application by the participant shall mean that the participant applies for the intraday credit in euro in the amount indicated in the Application submitted for the elapsing quarter. 3. If the total demand for the intraday credit in euro expressed by the participants: 1) remains within the limit referred to in Para.11, section 5 of this Agreement, the participant shall receive the credit in the requested amount, 2) exceeds the limit referred to in Para.11, section 5 of this Agreement, the NBP shall determine the amounts of the credit for the participants in proportion to the average turnover on the accounts in the preceding quarter. If the average turnover cannot be established, the NBP shall proportionally reduce the requested amounts of the credit. 4. The participant shall be informed in writing about the amount referred to in section 1 directly. The notification shall be signed by persons authorised according to the NBP s

3 regulations. The template of this notification constitutes Attachment no. 3 to Appendix no. 2 to this Agreement. 5. The NBP reserves the right to change the amounts of credit referred to in section 1 within a given quarter, should any changes be made to the total limit amount, servicing costs, the group of participants, subject to section 1 herein. 6. At the end of each quarter the participants are obliged to pay the servicing costs (calculated on the basis of the costs borne by the NBP) for the amount of credit allocated in that quarter. The amount depends on the NBP s costs of procuring the liquidity, and is drawn from the account. 7. The participant will be informed in advance about the amount referred to in section 6 as stipulated in the Para. 5, section 1 of Attachment no. 7 to Appendix no.1 to this Agreement. Paragraph 4. Collateral of Repayment 1. The subject of the transfer of full ownership rights for the purpose of securing repayment of the intraday credit in euro are bonds with the date of setting the right to their redemption falling no sooner than on the two business days following the date of establishing the collateral. 2. In order to secure the exposure of the NBP under the extended intraday credit in euro, the participant shall transfer the bonds deposited on the deposit account or securities account maintained for the participant with the NDS to the NBP`s account, in the number and with ISIN codes listed in the account statements, which is the equivalent to the transfer of ownership rights from bonds in favour of the NBP. 3. Documents for transferring bonds securing repayment of the intraday credit in euro to and from the deposit and securities accounts maintained with the NDS shall be submitted to the NDS by the paricipants and the NBP in compliance with the rules determined by the NDS. 4. Once the transfer of ownership rights from bonds in favour of the NBP occurs, the NDS shall submit an account statement to the NBP as a confirmation of such a transfer. 5. Securities detailed in the account statement shall be valuated by the NBP with the application of the formula defined in the Attachment no. 4 to Appendix no.2 to the Agreement for the purpose of calculation and extension of the intraday credit in euro. 6. The amount of the intraday credit in euro in relation to the collateral provided by the participant shall be calculated, on a relevant operating day, on the basis of the fixing rates

4 of bonds of the preceding day, announced by MTS-CeTO S.A. on the website 7. In the absence of the fixing rate for a given type of bonds on a given day, the amount of credit on the next trading day is calculated on the basis of the fixing rate set for the bond on the preceding day. 8. The accrued earnings and, where appropriate, detached but unpaid coupons are included in the market value of the collateral. 9. Having calculated the intraday credit amount the NBP shall credit the participant`s account with this amount. 10. The NBP reserves the right to request for the supplementary collateral if, in a daily valuation of the participant s collateral, the adjusted market value in accordance with what has been stipulated herein, is lower by more than one per cent than the extended intraday credit in euro. Paragraph 5. Extention and Repayment 1. The amount of the intraday credit in euro shall be subject to an increase or a reduction following an increase or a reduction of the collateral provided by the participant. 2. In order to reduce the provided collateral, the participant shall submit an order to the NBP for transferring the bonds; on the basis of the order, the NBP shall issue a document to the NDS to transfer the formerly provided bonds from the NBP securities account to the deposit account or the securities account maintained with the NDS for the participant. The template of the order for transferring bonds constitutes Attachment no. 2 to Appendix no. 2 to this Agreement. 3. The orders for transferring bonds reducing the provided collateral are executed on the condition that bonds included in such orders do not secure the intraday credit in euro drawn by the participant. The NBP shall debit the participant s account with the amount adequate to the volume of the reduced collateral. 4. The participant shall submit the orders referred to in section 2 in compliance with the rules laid down in The Rules for Maintaining Deposit Securities Accounts and Servicing Securities Transactions and their Recording on the Deposit Accounts Maintained for the Securities as provided by the NBP on website (

5 5. In order to increase the provided collateral, the participant shall submit the order referred to in Para. 4, section 3 to the NDS. The NBP shall credit the paricipant s account., in accordance with the Para.4, sections The intraday credit in euro shall be repaid on each operational day at 5:15 pm. ECB time by the execution of the NBP instruction debiting the account of the participant with the amount of the extended credit. 7. Should the intraday credit in euro be repaid by 6.00 p.m., ECB time the bonds securing its repayment shall be transferred back to the deposit account or securities account of the participant maintained with the NDS on the basis of a document issued by the NBP. 8. Should the participant fail to collect funds by 6.00 p.m. ECB time : 1) the NBP shall not return to the participants the bonds, the rights arising thereof have been transferred to the NBP to secure the intraday credit in euro, 2) NBP s claims shall be satisfied from the provided bonds with the transferred ownership title, securing the outstanding intraday credit in euro. In such a case the transferred bonds remain the ownership of the NBP and are valued according to market value. Paragraph 6. Termination 1. The grounds for suspension or termination shall cover any event which entails systemic risk or which could otherwise endanger the smooth operation of payment systems, including: 1) where a participant enters into insolvency proceedings; 2) where a participant is in breach of the the SORBNET-EURO system rules; 3) where the entitlement of a participant to participate in the SORBNET-EURO system is suspended or terminated; 4) the event referred to in Para. 11, section 12 of this Agreement shall occur. 2. The participant`s cancellation from drawing the intraday credit in euro shall be submitted in advance to the NBP in writing.