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Market Passport for Banks and Brokers

United Kingdom

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Market information

Supporting you

Key market information

  • Local currency

    British
    Pound (GBP)

  • 2017 GDP

    USD
    2,625bn

  • Time zone

    GMT

  • Numbering
    system

    ISIN

  • Main stock
    exchange index

    FTSE 100

Key market figures

Market capitalisation USD 3,460bn
Number of listed companies 1,255
2017 value of share trading USD 2,625bn
Number of ETFs listed 804
2017 value of bonds trading USD 8.15bn
Number of bonds listed 5,659
Number of futures contracts traded in 2017 0.39m
Number of options contracts traded in 2017 70.08m

Local market infrastructures

  Equities Corporate bonds Government bonds Derivatives
Trading London Stock
Exchange (LSE)
BrokerTec LSE ICE EUROPE
Clearing LCH.Clearnet Ltd.
SIX x-Clear EuroCCP
LCH.Clearnet Ltd. LCH.Clearnet Ltd. ICE CLEAR EUROPE
Settlement and custody Euroclear UK and
Ireland (EUI)
EUI EUI n/a
Cash leg CREST payment banks CREST payment banks CREST payment banks n/a

Local market authorities and regulators

  • The Bank of England is responsible for the stability of the financial system as a whole
  • The Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) supervise individual banks and other financial organisations (including recognised financial exchanges such as the London Stock Exchange). The PRA’s primary objective is to promote the safety and soundness of those institutions authorised by the PRA. The FCA is responsible for conduct of business, effective financial markets, consumer protection and for promoting effective competition
  • Euroclear UK & Ireland acts as the central securities depository for the UK and Irish market. As such there is the capability to settle in multiple currencies – GBP, EUR and USD

Market practices (ALL TIMES ARE LOCAL)

SECURITIES
Settlement cycles
Equities T+2
Bonds T+1
Cash T+0
Cut-off times
Equities T+2 2.55pm
Bonds T+1 2.55pm
Cash 6.10pm
 
Omnibus account/securities Yes
Omnibus account/cash Yes
Pre-matching No
Irrevocable pre-matching No
Short selling Yes
Cash settlement/DVP Yes
Securities lending Yes
Foreign ownership limits Yes
Derivatives
Settlement Cash and physical
Trading cut-off Depends on individual products
Clearing cut-off Depends on individual products
Tradable currencies EUR/USD/GBP/JPY/SEK/CHF/NOK/DKK
Account structure members Segregated
Account structure non-members Segregated and omnibus
Give-up Yes
Give-up cut-off T+3
Adjustable ITM (In The Money minimum) No
Intra-day margin call Yes
Risk algorithm IRM
Tolerance limits

GBP 10, EUR 15, USD 15.

Examples of market penalties

Matching A firm must match 100% of their transactions by 8.00pm UK time in the CREST system on T+1. Non-compliance with this target means the last party to input or amend an instruction will incur a fine of GBP 2 for each day the transaction remains unmatched, payable to EUI.

Settlement The CREST Settlement Discipline rules require that all CREST participants settle transactions according to specified target rate bands, relating to ISD and subsequent business days, e.g. band 0 representing the close of ISD; band 1 representing the close of the business day after ISD, etc.

CREST retrospectively determines the extent of non-compliance with these target rates for all bands up to ISD+20 for which it was the seller that did not settle on due date, and charges an ad valorem and a per transaction fine.

Buy-in practice on LCH.Clearnet Ltd

Buy-in process and fees for OEX transactions.

In the event that a settlement fail remains at the end-of-day on ISD+4, the Clearing House will automatically commence the buy-in process and notify Clearing Members accordingly. The buy-in execution date (“Buy-in Day”) will be ISD+5 except where the failed settlement is covered by for the market maker scheme in which case it will be ISD+11.

In the event that buying-in settlement cannot be achieved after ISD+20, then the Clearing House may cash settle any outstanding transactions at 120% of the last available closing price.

BNP Paribas customers benefit from free access to more detailed market information on our NeoLink webportal. Click here to access the Market Profiles or contact your relationship manager.

Supporting you

BNP Paribas Securities Services in United Kingdom

BNP Paribas Securities Services is the largest eurozone custodian present in the UK, delivering efficient and industry-leading securities services solutions

Our main services

Core

We offer local clearing and custody to domestic and foreign institutions. Our core services include settlement, on-exchange clearing, safekeeping, corporate actions, proxy services, cash and collateral management.

Market-specific

  • Issuance and paying agency services on CREST, along with CREST payment bank sponsorship covering the entire end-to-end liquidity management
  • Broker-dealer outsourcing under a Model A clearing arrangement
  • CREST sponsorship for central counterparties (CCPs)
  • A fully-automated solution for term Delivery by Value (DBV)
  • Full STP support of Repoclear flows via LCH Clearnet Ltd
  • A full global fund dealing platform
  • Global custody access point
  • Full London-Shanghai Stock Connect capabilities – once live at the end of 2018

What makes us different

  • One of the few non-UK custodians to propose Issuance and Paying agency services on CREST
  • 22% market share of total CREST settlement transactions (as at end 2017)
  • Market advocacy and close links with market infrastructures and associations including the LSE Post-Trade Committee, the Association for Financial Markets in Europe (AFME) and UK Finance Association

Selected market recognition

  • Global Custodian Agent Banks in Major Markets Survey (2011-2017): ‘Top rated’ and ‘Outperformer’
  • Global Custodian Leaders in Custody Awards (2017): Best Corporate Actions – UK – Ireland

A sound partner

BNP Paribas employs over 8,500 specialists in the UK (including 750 for BNP Paribas Securities Services), supporting UK-based businesses for over 150 years. We currently service over 90 clients from a local clearing and custody perspective.

Contact

For more information, please contact your relationship manager or
Philip Parmley, Head of Financial Intermediaries UK Sales
philip.parmley@uk.bnpparibas.com

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