In the Egyptian market, corporate actions are conducted at the end beneficiary level, utilizing the unified code. Corporate actions include coupon payments, which represent the annual interest rate, and the redemption of securities (bonds or bills) on specified maturity dates.
ECSD announces corporate action events to custodians via SWIFT messages (MT564). Also, the custodians could request to receive MT546 REPE on the end of the record date for the eligible clients on the CA event, Coupon interest and redemption payments are automatically deposited by ECSD into the appropriate RTGS cash accounts of custodians.
Payment confirmations are sent to the subscribed custodians through SWIFT messages (MT566).
Coupon payments represent the annual interest rate on government bonds, expressed as a percentage of the face value and distributed at regular intervals (annually, semi-annually, quarterly, or monthly) throughout the bond’s lifecycle.
Redemption refers to the repayment of securities (bonds or bills) on the specified maturity date, which includes final redemption (held until the original maturity date) and full early redemption, where the Ministry of Finance (MoF) has the authority to recall the entire position/security prior to the original maturity date.
The MoF provides instructions to the CBE to credit ECSD's cash account on the actual pay date. ECSD reconciles the amounts received with the MoF letter and credits the custodians’ relevant RTGS cash accounts, after deducting the withholding tax amounts from the net proceeds.
Upon receiving the funds, custodians must promptly transfer the funds to the designated end beneficiary cash accounts.
ECSD claims custodians on a monthly/annual basis in accordance with approved fee schedules related to various services approved by Financial Regulatory Authority (FRA). All invoices will be disseminated to custodians by the 5th calendar day of each month, reflecting charges for the previous month.
ECSD executes a direct debit from the cash accounts relevant to custodians' RTGS, utilizing the authorized direct debit authority by the 10th calendar day of every month.
