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Central Depository Committee of Pakistan.pptx

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Central Depository Committee of Pakistan.pptx

  1. 1. • By Muhammad Mazhar • Sikander Hayyat Sheikh • PhD (CyS) Central Depository Company of Pakistan(CDC) An Analysis
  2. 2. Agenda • Introduction • Transactions Handled By CDC • CDC Certifications • Departments • Organization • Organization Management • Services Offered • Scope of Services Offered • Threat Landscape • Executives of CDC • Conclusion 2
  3. 3. Introduction (2 of 3) • Incorporated as a public limited (Unlisted) company in 1993, Central Depository Company of Pakistan Limited (CDC) is the only depository in Pakistan. • The Company started operations in September 1997. • CDC is the Sole Entity handling the electronic (paperless) settlement of transactions carried out at all three stock exchanges of the country. • The main function of CDC is a create and maintain the Centra Depository System CDS drawing guidance from a well- designed legal framework laid down by Securities and Exchange Commission of Pakistan (SECP). 4
  4. 4. Introduction (3 of 3) • CDS is an electronic book entry system used to record and maintain securities and to register the transfer of securities. • The system changes the ownership of securities without any physical movement or endorsement of certificates and execution of instruments. • CDS facilitates equity, debt and other financial instruments in the Pakistani Capital Market. • It manages Ordinary & Preference shares, TFCs, WAPDA Bonds Sukuk etc. 5
  5. 5. Transactions Handled By CDC • Deposit of Securities. • Transfer of Securities. • Pledging of Securities. • Pledge Release. • Pledge Call. • Withdrawal of Securities. • Corporate Action Regulated by SECP. 6
  6. 6. Departments (1 of 2) • Investor Account Services (Est 1999) • Allows the retail and corporate investor to open and maintain custody accounts directly with CDC. • Trustee and Custodial Services (Est 2002) • Serves as a Trustee to Open-end and Closed-end Mutual Funds and Voluntary Pension Schemes. • CDC Share Registrar Services Limited (Est 2008) • Provides share issuing companies state-of-the-art facilities of registrar and transfer agents, including customer dealing on behalf of the companies. • ITMinds Limited (Est 2009) • Provides Business Process Outsourcing (BPO) services which include provision of back-office accounting functions to the Mutual Fund industry. 10
  7. 7. Departments (2 of 2) • Operations & Customer Support Services • Information Technology • Legal, Finance & Company Secretariat • Human Resource • Administration • Internal Audit and Risk • Enterprise Security • Compliance • Product Development & Marketing. 11
  8. 8. Threat Landscape • Ransomware: • At CDC, they have data resilience achieved via replication among 3 geographically dispersed data centers to avoid single point of failure. • The arrangement ensures high availability, business continuity and disaster recovery at a zero data loss. 12
  9. 9. 13
  10. 10. 14
  11. 11. Organization Hierarchy 15
  12. 12. Organization Hierarchy Cont. • The Chief Internal Auditor functionally reports to the Board and administratively reports to the Chief Executive Officer. • The CEO of CDC is Badiuddin Akber. • Shariq Jafrani is CFO and Company Secretary. • Muhammad Yaseen is Chief Internal Auditor. 16
  13. 13. Services Offered • Investor Account Services (IAS): • Investor Account Services (IAS) allows retail investors to directly open and maintain accounts with CDC in Central Depository System for secure and safe custody of securities. • Investors have direct access to their securities through Investor Account, which are maintained by CDC and operated on the instructions of investors. • Trustee & Custodial Services (T&C): • Currently, CDC is acting as a Trustee with 88% market share in terms of number of Funds and 96% market share in terms of the Net Assets in various categories of Mutual Fund in Pakistan. 17
  14. 14. Services Offered Cont. • CDC Share Registrar Services Limited (SRS): • It facilitates Share Issuing organizations and their shareholders. CDCSR offers a composite portfolio of maintenance, registration, verification and direct customer dealing & interaction. • Centralized Information Sharing Solution for Insurance Industry (CISSII): • This automation and sharing of information were achieved through the Centralized Information Sharing Solution for Insurance Industry which provides a centralized database hosted by a neutral and independent institution, such as CDC, and which has a track record of managing secured and huge databases with state-of-the-art infrastructure having built-in information security features. 18
  15. 15. Services Offered Cont. • Investor Portfolio Services (IPS) • Facilitating investors in opening and maintaining an Investor Portfolio Services (IPS) Account to keep Government Securities with CDC since 2014. • Another such initiative which has been launched in 2020 to facilitate Capital Market investors is the facility that assists TREC Holders & their clients to pledge their Government Securities held in CDC IPS account in favor of NCCPL as margin against their equity trades, like any other capital market security, without transferring ownership. • Shared KYC & Roshan Digital Account 19
  16. 16. Scope of Services: T&C • Transaction Settlement. • Nominal Ownership of the Assets. • Compliance with Regulatory Requirements. • Corporate Actions. • Portfolio Reporting. • Tax Reporting. 20
  17. 17. Scope of Services: SRS • Maintenance of computerized Members' Register. • Maintenance of specimen signatures of shareholders. • Dealing with Security holders on SRS Counter, telephone, through mail and E-mail. • Verification of Security holders' signatures on Transfer Deeds and Proxy Forms etc. • Physical Transfer of Securities. • Deposit of Securities into CDS, Withdrawal of Securities from CDS and transmission of physical certificates / Securities etc. • Issuance of duplicate certificates and dividend warrants against appropriate indemnities and fulfillment of formalities. 21
  18. 18. Scope of Services: SRS Cont. • Split / Consolidation / Renewal of certificates. • Dividend Entitlements and Payments to Security holders. • Bonus Shares issuance to Security holders with fractional shares payment. • Custody of undelivered certificates and dividend warrants, etc. • Preparation of reports related to the securities and Security holders for filling with Issuers / Regulators. • The operations of the company are carried out by a team of highly talented and experienced professionals belonging to a wide spectrum of relevant disciplines with graduate and postgraduate qualifications from distinguished local and foreign institutions. 22
  19. 19. Scope of Services: SRS Cont. • Taking attendance of Security holders in Annual General Meeting (AGM) / Extra-Ordinary General Meeting (EOGM). • Compliance of legal obligations as Share Registrar / Transfer Agent. • Other standard Share Registrar department activities such as dispatch of Annual / Half/Yearly Accounts, etc. • They also have future plans of handling the following transactions (IPO handling, Registrar Services to Open Ended Mutual Funds). 23
  20. 20. CEO • CEOs are responsible for managing a company's overall operations. • This may include delegating and directing agendas, driving profitability, managing company organizational structure, strategy, and communicating with the board. • Badiuddin Akber is CEO of CDC. 24
  21. 21. COO • A COO, or chief operations officer, oversees a company’s business operations and reports to the CEO. • A COO ensures the company has effective operational and financial procedures in place. • Abdul Samad is current COO of CDC. 25
  22. 22. CIO • A chief information officer (CIO) is the company executive responsible for the management, implementation, and usability of information and computer technologies. • Syed Asif Shah is serving as CIO of CDC. 26
  23. 23. CISO • The CISO (chief information security officer) is a senior-level executive responsible for developing and implementing an information security program, which includes procedures and policies designed to protect enterprise communications, systems and assets from both internal and external threats. • Syed Hassan Aslam is current CISO of CDC. 27
  24. 24. CFO • The CFO is the top ranking executive related to managing a company's finances. • This includes managing all aspects of financial and cash flow planning, as well as analyzing its financial position. • Shariq Jafrani is CFO of CDC. 28
  25. 25. CCO • The Chief Compliance Officer, one of the most important members of the management team, is primarily responsible for overseeing compliance within an organization, and ensuring compliance with laws, regulatory requirements, policies, and procedures. • Hammad Ali Faisal is Chief Compliance Officer of CDC. 29
  26. 26. CIA • Chief Internal Auditor are responsible for ensuring that their organization is following all applicable laws and regulations. • They also commonly provide guidance to other employees on how to comply with these rules, as well as advice on how to avoid breaking them in the future. • Muhammad Yaseen is the Chief Internal Auditor of CDC. 30
  27. 27. Thankyou 

Editor's Notes

  • 2nd : As per Companies Act, 2017
    3rd: Lhr, ISB, KHI
    4th eliminate the long process of handling and transfer of shares physically. As the CDC is only depository of Pakistan, it handles all the electronic transactions happening in the stock exchanges of Pakistan.
    5th CDS or Central depository system is a system which works in electronic book-entry-system which holds and maintains all the securities data and their transaction records.
  • 27001:2013 certified for Information Security Management
    ISO/IEC 22301:2012 certified for its Business Continuity Management Program
  • Supported by a resilient IT infrastructure, disaster recovery and business continuity arrangements, CDC can respond to a number of business disruptions by resuming critical functions in the shortest possible time span. CDC conducts regular business continuity drills involving users and partner organizations to assess its crisis management capabilities. The motivation and efforts involved in achieving this global standard highlights CDC’s best practices approach for the investors’ protection and the benefit of overall capital market.
  • Trustee & Custodial Services:
    In the early 2000s, the Mutual Fund industry started flourishing in the Pakistan Capital Market and provided a new concept and investment arena to retail and individual investors who possess inadequate knowledge of the capital market but are interested in utilizing its benefits. CDC recognizing the potential of this industry sector, launched Trustee & Custodial Services in 2002, initially with two open-ended mutual funds with net assets value of Rs. 500 million.
  • T&C Services
  • SRS Services
  • Syed Hassan Aslam CISO