## How to Organize Central Securities Depositories in Developing Markets: Key Considerations

_IMF How To Notes, February 4, 2019_

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## Bibliographic details
- Authors: Froukelien Wendt, Peter Katz, Alice Zanza
- Published: February 4, 2019
- Series: IMF How To Notes
- DOI: https://doi.org/10.5089/9781484397312.061

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### Summary
- Key objective: support authorities in decision making about the optimal organization of central securities depositories (CSDs) in their country.
- Definition used: a CSD is an entity that provides securities accounts, a securities settlement system, and central safekeeping services to market participants, which can be banks and other financial institutions.
- Two central questions for authorities in developing markets, in particular central banks:
  - Whether to pursue a single CSD to increase market efficiencies and benefit from economies of scale and scope.
  - Whether to partake in the governance of the CSD as owner or operator.
- The note presents seven considerations for authorities to take into account when answering these questions and determining the best model for their country.

### Major considerations for organizing CSDs (as framed by the note)
- Trade-offs between a single CSD and multiple CSDs:
  - Single CSD: potential to increase market efficiencies and benefit from economies of scale and scope.
  - Multiple CSDs: implicit trade-offs not detailed on the landing page but framed as alternatives authorities must weigh.
- Governance and ownership choices:
  - Whether authorities should partake in governance as owner or operator is a central decision point.
- Operational scope and services:
  - A CSD’s core services include securities accounts, securities settlement systems, and central safekeeping.

### Target audience and purpose
- Intended readers: authorities in developing markets, in particular central banks and other public sector bodies involved in market infrastructure decisions.
- Purpose: provide guidance and structured considerations to determine the best organizational model for a country’s CSD(s).

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_Source: https://www.imf.org/en/publications/fiscal-affairs-department-how-to-notes/issues/2019/02/04/how-to-organize-central-securities-depositories-in-developing-markets-key-considerations-46573_