MERKEZİ KAYIT KURULUŞU:CENTRAL SECURITIES DEPOSITORY OF TURKEY
MKK - MERKEZI KAYIT KURULUSU
Central Securities Depository of Turkish Capital Markets for dematerialized securities
Turkish capital markets is fully dematerialized Beneficial-owner based system with the opportunity of having «omnibus accounts» for foreign
CSDs & ICSDs
Supervised & Regulated by the Capital Markets Board of Turkey (CMB)
Officially Licensed R&D Center In-house developed depository sytem; «Central Dematerialized System» In-house developed Inverstor Services ; «e-MKK Services»
Financial Accounts Center of Turkey All accounts that are opened in the financial system System integration with «Ministry of Internal Affairs» & «Ministry of Finance»
Direct Link with the Austrian CSD – OeKB
GENERAL INFORMATION
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DEMATERIALIZATION PROCESS
SECURITY TYPE DATEDEMATERIALIZATION
RATE(%)
Stocks 2005-2007 %100
Mutual Funds 2005-2006 %100
Exchange Traded Funds 2005 %100
Private Sector Bonds 2006 %100
Private Sector Commercial Papers
and Bank Bills2009 %100
Warrants 2010 %100
Asset Covered Securities / Asset Backed
Securities2011 % 100
Government Bonds & T-Bills 2012 % 100
Certificates 2012 % 100
Sukuks 2012 % 100
1 Member
2 Members
1 Member
% 64.9
SHAREHOLDERS
BOARD STRUCTURE
MKK - SHAREHOLDERS & BOARD STRUCTURE
% 5% 30.1
3 Members
1 Member 1 Member
The Association of Capital Market Intermediary Institutions of Turkey
Central Securities Depository of Dematerialized Capital Market Instruments
(November.2005)
Financial Accounts Center for all the accounts opened in Turkish Financial Sector
(October.2011)
Electronic General Meeting Center for all Borsa Istanbul listed Companies
(August.2012)
Electronic Commodity Center for all e-Warehouse Receipts (December.2012)
Digital Company Center for Companies’ «Information Society Services»
(October.2013)
R&D Center for its Software Development Technologies (November.2013)
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MAIN DUTIES AND RESPONSIBILITIES
Developed by MKK R&D Center, e-signature usage
Web Based – Java Application – Remote Access
Secure messaging infrastructure MOM (Message-Oriented-Middleware)
ISO 27001 Information Security Certification
ISO 22301 Business Continuity Management System Certification
Award of merit at the 7th Technology Conference by TUBITAK (Scientific and Technological Research Council of Turkey)
TTGV (Technology Development Foundation of Turkey)
TUSIAD (Turkish Industrialists’ and Businessmen’s Association)
TUBITAK R&D support
DEMATERIALIZED SYSTEM SOFTWARE
R&D SUPPORT
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CENTRAL SECURITIES DEPOSITORY ACCOUNT STRUCTURE
MKKPARTICIPANT «A»
(INTERMEDIARY INST.)
Participant Portfolio Acc. Investor Acc.(1)
Free
Pledge
Attachment
PARTICIPANT «B»
( (I)CSD )
(I)CSD Portfolio Acc.
(I)CSD Investor Acc. (Beneficial Owner)
Free
Pledge
Attachment
«Omnibus» Account
SUB-ACCOUNTS
ACCOUNTS
PARTICIPANTS
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MKK Central
DematerializedSystem
ISSUERCOMPANY
INTERMEDIARY INSTITUTION/BANK
Legal Entity
INVESTORS
Real Person
MINISTRY OF FINANCE
MINISTRY OF INTERNAL AFFAIRS
TAX ID NO
T.R. ID NO
TAX ID NO
T.R. ID NO
ISSUERCOMPANY
INTEGRATIONMKK MEMBER AND
ACCOUNT STRUCTURE
INVESTOR ACCOUNTS
INVESTOR ACCOUNTS
APPLICATION FOR ACCOUNT OPENING
Investors
Accounts
ELECTRONIC ACCOUNT OPENING
REGISTRY NO & PASSWORD
INTERMEDIARY INSTITUTION/BANK
e-Government Integration
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All accounts opened in Turkish Financial Markets
ID and contact information of every Investor in Turkey
(phone numbers, e-mail and mail addresses of investors)
ACCOUNTS OPENED (2012 vs 2013)
YEARNUMBER OF ACCOUNTS
OPENED
NUMBER OF FOREIGN INVESTORS’
ACCOUNTS OPENED
FOREIGN OWNERSHIP
(%)
2012 4,431,409 19,208 0,433%
2013 3,214,464 19,861 0,618%
In 2013, 42% increase in the number of depository accounts opened by the foreign investors compared to 2012
• 333 BILLION USDASSETS UNDER CUSTODY (MARKET VALUE)
• 23,188,568NUMBER OF INVESTORS
• 3,609,422INVESTOR ACCOUNTS WITH A BALANCE
• 43,376,355NUMBER OF ACCOUNTS
• 4,278,759NUMBER OF ACCOUNTS WITH A BALANCE
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FIGURES (February 2014)
• 1,115,151 INVESTORS• 220 BILLION US $STOCKS
• 36,594 INVESTORS• 81 BILLION US $
GOVERNMENT DEBT SECURITIES
• 2,746,347 INVESTORS• 13 BILLION US $MUTUAL FUNDS
• 173,735 INVESTORS• 16 BILLION US $
CORPORATE BONDS
• 3,676 INVESTORS• 93 MILLION US $
EXCHANGE TRADED FUNDS
• 3,216 INVESTORS• 4.07 MILLION US $
STRUCTURED PRODUCTS
• 2,717 INVESTORS• 1.594 BILLION US $
OTHER SECURITIES
Free Float:84 bil. US $
Non Free Float:136 bil. US $
CUSTODY-SECURITIES(February 2014)
ForeignOwnership:
% 61.23
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e-CAS : Investor Notification
MKK - Investor Services
Random Report Delivery
IVR System/ Call Center
Mobile Blockage Electronic Report Posting System
Instant Notifications Account Movements Information on
Corporate Actions
Periodic Notification Portfolio Status
Account Movements
Monthly 10,000 Investors Portfolio Status
Information Portfolio Status Account
Movements Reports
Investor Blockages
AloMKK(444 0 655)
Mobile Services SMS
Electronic Reports(e-mail)
Electronic Notification(SMS & e-mail)
Random Notifications
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e-GOVERNANCE : Corporate Governance & Investor Relations
e-GEM : Electronic General Meeting
e-DATA : Capital Markets Data Bank
Participation to General Assembly meetings by remote access & mobile applications - voting by electronic means
Distribution of capital markets data by econometric models RISE (Investor Risk Appetite Index)
Communication bridge between companies and shareholders
Real time notification of investors regarding the movements in their accounts
e-WAREHOUSE RECEIPT : Electronic Warehouse Receipt Center
Conversion of agricultural products to electronic warehouse receipts
Mobile Corporate Governance Project which is a platform to enhance corporate governance and investor relations and develop transparency and information access for market participants
Communication bridge between companies and shareholders Continuous information exchange between shareholders and companies
through internet, e-mail and mobile applications Enables companies to reach their shareholders directly Enables shareholders to access information on companies easily and
completely Investor Information Center TUBITAK R&D support
R&D SUPPORT
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DevelopmentStartedNov 2011
LaunchedOct. 2012
Load TestsJul-Aug 2012
Pen. TestsSept. 2012
DevelopmentFinishedJul 2012
«One of the pioneering applications in scope»
Developed in-house, launched and operated by MKK (Central Securities Depository of Turkey), e-GEM is a multilingual, real-time online general meeting, e-voting and e-proxy platform. The platfrom can be easily customized based on different requirements of any financial markets.
With its launch on 01 October 2012, issuers/companies started to use e-GEM for conducting online general meetings as per the requirement of the Capital Markets Board of Turkey.
Turkey is the first country to make it a legal obligation for Borsa Istanbul listed companies to enable electronic means for their shareholders to attend general meetings via e-GEM. It is possible for non-listed companies to use e-GEM as well.
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What Kind of Operations are Carried Out on e-GEM;
Issuers make convocations on e-GEM and upload proxy materials to the system.
All parties are notified when convocation is made on e-GEM.
Access to proxy materials including meeting documents.
Proxy assignment and delivery of voting instructions without any PoA documents.
Pre-registration of the vote preferences.
Live stream of general meetings.
Issuers can easily prepare list of attendees on e-GEM.
Participants can ask questions, express opinions and vote online during the meeting.
Physical and electronic votes are aggregated on e-GEM and calculated by the system to give the exact result for each agenda item.
Access to voting results as soon as the meeting finishes.
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Minimum Costs (operations & time)
General Meeting Process from A to Z
Vote Recording
Attendance to Concurrent Meetings
Access to Proxy Materials
Instant Notifications
No Record Date
Partial & Split Voting (through intermediary)
No Shares Blockage
Paperless Proxy
Vote Instructions
Live Stream of Meeting
What e-GEM Brings to Investors;
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Minimum Operational and Out of Pocket Costs
Vote Recording
Paperless Proxy
Attendance to Concurrent Meetings
Instant Reporting
No Record Date
No More Blocking
of Shares
Integration with SWIFT
e-Attendance
What e-GEM Brings to Custodians;
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13,464 investors attended electronically, 6,196 investors attended physically (19,660).
In its first year attendance ratio increased by 124%.
Among 13,464 investors electronically attended, 13,265 are foreign investors
Among 6,196 investors physically attended, 1,850 are foreign investors
Average number of physical attendees per GM is 13.
Average number of electronic attendees is 34 per GM
STATISTICS (Oct’12-2013)
YEAR MEETING ATTENDANCE (FOREIGN INVESTORS)
2011 4,753
2012 6,036
2013 15,115
Total Number of General Meetings Held on e-GEM 423
Average Length of General Meetings 43 minutes
Total Number of Electronic Attendees 13,464
Total Number of Physical Attendees 6,196
Number of (Investors’) Nationalities Using e-GEM 41
Maximum Number of Electronic Attendance 756
Maximum Number of Meetings Held on the Same Day 32
Average Voting Period on e-GEM 10 seconds
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Public Disclosure Platform (PDP): PDP is the primary official source of information for Borsa Istanbul (listed) companies, who are required to publicly disclose; their financial statements, any material events (events that give rise to Insider Information and Continuous Information), other events (Monthly notifications, Net asset value statements, Articles of Association, Fund Charter, Prospectus, circular, Notifications regarding the mergers, acquisitions and divestures, General information form of the company, Tender offer information form).
GENERAL INFORMATION & STATISTICS
Platform Operational Hours 7/24
Number of Data Vendors Linked to Platform 16
Number of Sub-Vendors Linked to Platform 17
Number of Companies Covered by the Platform 550
Number of Platform Users 2500
Number of PDP Members 1,453
Number of Notifications Sent in 2013 72,100
Notification of Investors via SMS & e-mail on the movements that take
place from out of their accounts
Activates whenever a transaction on their accounts is made
Real time notification of investors on the movements that take place
possible errors and fraudulent attempts that take place on their accounts.
Decreases possible individual or systemic risks Notification Phase: Notification is made after the transaction is completed. Blocking Phase: Transaction is not completed unless the investor subscribes to
e-CAS Service.
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Adapting the dematerialized system to agricultural industry of Turkey
and Turkic Republics
Integration of agricultural sector with capital markets
Conversion of agricultural products stored in licensed warehouses to
electronic warehouse receipts
Safekeeping of electronic warehouse receipts in MKK’s electronic
book-keeping system
Trading of products at the Commodity Exchange
Farmers Notification System
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Central data bank of the capital markets
Co-operation with Ozyegin University & Markit Partners
Distribution of all data produced in the Turkish capital markets by econometric models in a
secure, consistent and reliable manner
Statistics on capital markets in international standards
Academic articles and research reports
Investor Confidence Index, Investor Risk Appetite Index, Attachment Index and Financial
Indicators
Electronic securities database
Contributing to academic research and decision-making processes of policy makers
Providing reliable & consistent data to ratings institutions
MKK is awarded with the “Best Big Data Project in Financial Sector” award by the International
Data Corporation (IDC)21
A weekly indicator, analyzing 850,000 investor data Calculated by taking weekly portfolio changes of the investors who own at least 5,000 TL stock portfolio
value at any period beginning from 28 November 2005. Changes of the investors’ stock and A-type mutual funds total portfolio values on every Friday adjusted for
the changes in BIST-100 are used RISE index covers all investor types, such as “Domestic &/ or Foreign Investors” and etc. Using a matrix of variations, investors are given scores between “0” and “1”
If the calculated index is above (50), it implies that the investors are holding a rather risky portfolio; If the calculated index is below (50), then it implies that the investors are holding a rather risk-free portfolio compared to
previous period of 2 weeks;
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MKK – 2014 TARGETS
Central Depository System Upgrade v2.0 (CDS v2.0)
Establishing new Collaboration and Cooperation Models with Foreign CSDs and ICSDs
Upgrading and Updating of MKK’s Information Technologies Infrastructure
e-GEM SWIFT Integration for both ISO 15022/20022
Taking Over Borsa Istanbul’s «Public Disclosure Platform – PDP» and Upgrading it to v4.0
(MKK has taken over the platform as of March 17th)
Providing Support and Maintenance of Systems for Borsa Istanbul – Nasdaq OMX
Partnership
Dematerialising new Agricultural Products under the Scope of e-WAREHOUSE RECEIPT
Services Provided by MKK
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MKK - FUTURE OUTLOOK
Maximizing Ancillery Service & Value Added Service Revenues (50%)
Data/Information Vendoring
Financial Information Services
Investor Services
Commodity & Capital Market Integration
Innovative IT Services & Software Development
New Value Added Services to utilize information capacity
Implementation of international industry standards (Full STP in Corporate Actions
Operations, ISO20022, LEI, etc.)
Integration,Cooperation and Partnerships with Europe, Middle East, North Africa and Turkic
Republics counterparties to complete the post-trading chain from West to East
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