Tadawul Group’s post-trade enhancements come into effect today

Logo of Saudi Tadawul Group Holding

The Saudi Tadawul Group Holding (Tadawul Group) starts today, April 3, the roll-out of new enhancements through its subsidiaries to develop the post-trade services infrastructure.

The new package of enhancements is introduced through Tadawul Group’s subsidiaries, – Saudi Exchange, Securities Clearing Center (Muqassa), and Securities Depository Center (Edaa).

In Saudi Exchange, the new enhancements cover the introduction of a more efficient handling of order flow by market participants, such as an enhanced mechanism for short-selling activities. Further enhancements include buy-in trades executed at the exchange and settled on the same day (T+0). For negotiated deals, investors will now benefit from a flexible settlement cycle, allowing buyer and seller to agree on a settlement cycle from T+0 to T+5 based on their deal requirements and, finally, additional flexibility in the trading experience and settlement cycles for securities traded over-the-counter.

For Muqassa, clearing services will be extended to cover equities, sukuk and bonds, and traded funds markets to adopt a more comprehensive risk framework and facilitate the introduction of new products and services for clearing members. New post-trade services include rectifying trade before settlement, average price trades or split price trade and other enhancements and services.

Moreover, a new central securities depository system and post-trade services will be introduced in Edaa, in alignment with international standards, to enhance the experience for capital market institutions, custodians, settlement agents and investors. Further enhancements include straight-through processing of ISO messaging, as well as the daily and ad-hoc reconciliation and reporting of participants and other enhancements.

The introduction of these enhancements, which are the largest in the history of the Saudi capital market, will provide investors and market participants with a wide range of investment opportunities and enable access to new and diversified financial instruments to manage risk and benefit from market movements.

It will enhance investor access, improve risk management tools, and enhance trade and post-trade services for entities operating in the domestic capital market such as capital market institutions and banks, as part of wider efforts to reinforce the capital market’s position as a globally attractive investment destination.