The main features of settlement of securities transactions carried out in the Norwegian securities market are as follows:

  • Dematerialised securities (no physical securities).
  • A single central securities depository – VPS (the Norwegian Central Securities Depository).
  • Investors are permitted to operate their own accounts with VPS.
    • Domestic holders – must hold securities on their own VPS account.
    • Foreign holders – may hold securities either on their own VPS account or through a nominee.
    • Investors can manage their VPS accounts either through an account operator or directly over the internet.
  • Settlement is carried out through an investment firm or a settlement agent.
  • The parties that participate in the central securities system for settlement in Norwegian kroner are investment firms, settlement agents and CCPs.
  • In order to participate in the central securities system, settlement participants must provide a liquidity guarantee either by holding an account with the Norwegian central bank (Norges Bank) or by having access to an account with Norges Bank through an arrangement with a bank that operates such an account, known as a liquidity bank.
  • Delivery versus payment (DvP) – NOK payment in central bank money.
  • Multilateral netting.
  • Automatic pool-based arrangement for securities borrowing and lending.
  • Extended balance checking for availability of cover across multiple accounts.

 

VPS uses international standards

  • Settlement instructions can be given using ISO 15022.
  • ISO 6166 is used for Norwegian financial instruments.
  • VPS is responsible for allocating international securities numbers (ISIN) in Norway.
  • BIC codes are used to identify settlement participants when matching transactions.