Strate, a South African Central Securities Depository (CSD), has shown the robustness of its clearing and settlement technology by offering equities settlement to multiple markets.
On 28 February 2017, it welcomed 4 Africa Exchange (4AX), the country’s newest exchange which focuses on listing companies that are currently trading over-the-counter (OTC) shares in Broad-based black economic empowerment (B-BBEE) schemes as well as limited participation schemes. 4AX successfully integrated their exchange into Strate’s clearing and settlement platforms. 4AX offers investors a T+3 settlement cycle, allowing trades matched on its system to be cleared and settled within three business days after the trade date.
At the beginning of September 2016, the Financial Services Board notified the market that it had granted 4AX an exchange licence. Strate was appointed by 4AX to provide it with central securities depository services.
Beverley Furman, the Managing Executive of CSD Operations, a division of Strate, says, “This is an exciting time for the capital markets. Three years ago, companies that had been trading OTC shares in B-BBEE schemes were instructed by the Registrar to license their over-the-counter platforms as a regulated exchange, or stop such trading activities, or apply for exemptions. Now the country has a dedicated exchange in the form of 4AX that can serve these companies.”
“Strate has been built on an 18-year foundation of trust, where we can be relied on by the markets to provide pioneering solutions that cater directly for their needs. The strategic focus has been on the evolution and strengthening of Strate’s core services. As we extend our services to multiple exchanges across multiple markets, it cements this notion, as well as our independence and high levels of operational excellence.”