Taiwan Depository & Clearing Corporation

In support of the government’s New Southbound Policy, TDCC has been committed to helping businesses establish a foothold in Southeast Asia. On June 6, TDCC was invited by KGI Securities, a brokerage that has entered the Thailand market for years, to share its first-hand experience in promoting securities dematerialization, centralized clearing and settlement, and cross-border custody at a seminar hosted by the Thai Bond Market Association (TBMA) in Bangkok. TDCC also engaged in bilateral exchanges with TBMA, which is the competent authority of the debt market in Thailand.

TDCC mainly provides post-trade services for the capital market as well as centralized clearing and settlement of bills. It is also the main entity in Taiwan that pushed for dematerialization of bond, negotiable certificate of deposit (NCD) and commercial paper, as part of a major system reform in Taiwan’s financial market. As such, TDCC has accumulated considerable experience in market practices and system establishment. The event organizer invited dozens of representatives of government authorities, securities firms and banks to the seminar. In addition to delivering a keynote speech on “Dematerialization of Bills & Corporate Bonds in Taiwan and Their Clearing & Settlement Systems,” TDCC also engaged in exchanges with other participants on cross-border custody of foreign securities.

TDCC was commissioned to achieve securities dematerialization, and over the past few years, it had successfully constructed mechanisms to process listed stocks (both on the TWSE and TPEx markets), corporate bonds, financial bonds, funds and short-term bills electronically. In September 2017, TDCC fulfilled the last piece of the puzzle by introducing a system for dematerialized issuance of commercial paper. Since then, securities in Taiwan have become fully paperless, achieving the government’s target to build a digitized financial environment. Electronic processing of securities not only helps reduce labor cost and manual operating risks, but also substantially enhances the overall efficiency of the market.

TDCC noted that the seminar presented an excellent opportunity for the company to share experience in securities dematerialization with its Thai counterpart. Also, the exchanges with other capital market participants from abroad should help businesses know their target markets better before expanding to Southeast Asia, echoing the government’s New Southbound Policy. It is the genuine hope of TDCC that the exchanges will help Thailand develop an optimal market system, and further strengthen the friendship between Taiwan and Thailand in the long run.