July 24, 2019      
Last Data Update:22/07/2019

Clearing and Settlement

Definition

The securities Clearing and Settlement System means the assignment of the rights and obligations arising from the process of securities trading and the coverage of the financial centers resulting from these trades and the consequent deductions and additions in accordance with what has been implemented.

Objectives of settlement and clearing system in Muscat Securities Market
  • Reduction of the risks resulting from the completion of the receipt and delivery of securities and the monetary values of the trades that take place in the stock market among broker companies operating in the field of securities.
  • Execution of the clearing and settlement process and completion of the transfer of ownership at the specified time.
  • Increase the turnover of securities in the market as a result of ensuring that the settlement is completed at the specified time.
  • Attracting foreign investment through international standards and the implementation of the DVP system and ensuring that all customers receive their rights on time.
  • In general, provides credibility and confidence to dealers in the market. 
Settlement Cycle in the Market

Muscat Clearing and Settlement Company, represented by the (Clearing and Settlement Department), shall execute clearing and settlement trades for the purpose of specifying the net rights and obligations of the members and completing the procedures of settlement processes of the financial centers resulting thereof and transfer ownerships as follows:
 
  • (2+T): Expiration of the settlement period of the securities traded on the second day after the trading day of bonds.
  • (3+T): Expiration of the settlement period of the securities traded on the third day after the trading day of equities.
Or as may be adopted from time to time by the Capital Market Authority in determining settlement periods (shares / bonds / Sukuk) and other financial tools.
 
 
 
Timing of Settlement Cycle

The cash settlement process is completed at 1:00 pm through the (RTGS) total instantaneous settlement system linked to the Central Bank of Oman by (adding / subtracting) to and from the Central Bank of Oman Settlement Account and the commercial banks’ accounts of the broker companies. While the stock settlement procedures are completed at 1:15 pm on a final basis by deducting the securities from the sellers’ accounts and adding them to the buyers` accounts. Or as may be adopted from time to time by the concerned authorities.
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