Delivery Netting
The CSP minimises the number of delivery obligations for each settlement process by netting Novated Cash Market Transactions (Cash CCP Transactions).
Cash CCP Transactions are netted to create a single Net Broker Obligation (NBO) for a specified settlement date using the below criteria:
- Account - Settlement Entrepot HIN; and
- Security; and
- Basis of Movement (BOM).
Once the CSP has completed the Netting process, it notifies the Clearing Participant and/or the Settlement Participant. Where the identifier of the Clearing Participant is different to the identifier of the associated Settlement Participant for that Clearing Participant then a Netted Obligation Report will be sent to both.
Netting Eligibility
Cash CCP Transactions are eligible for netting where:
- The Settlement Date is in two business day; and
- The Trade Date is at least two business days before Settlement Date.
Netting Exclusions
Cash CCP Transactions are excluded from Netting under certain conditions. The excluded transactions, with the same settlement date, are aggregated as part of a settlement process with the Participant's other obligations for that settlement day.
Cash CCP Transaction Netting Exclusion Conditions
| Cash Market Netting Exclusion Condition | Description |
|---|
| 1. Contain the following condition codes: | - OR - OVERSEAS RESIDENT (FOREIGN TO FOREIGN)
- P1 - PUT THROUGH TRADE REPORT - $1M
- P2 - PUT THROUGH TRADE REPORT - $0.5M
- PR - PROMPT RE-BOOKING
|
| 2. Record an “As At” date | Cash Market Transactions with a shortened settlement period, which have an "As At" date in the past and carry a settlement date of T+1. |
| 3. Are selected at the discretion of ASXS. |
|
In rare circumstances the CSP may reverse netting, for a particular financial product, for a number of financial products or for all financial products. The CSP will reverse the subject Net Broker Obligations and reinstate the original Cash CCP Transactions and notify Participants accordingly. Refer to Netting Reversal.