Looking at the capital market and what was happening in the KDPW Group, it can certainly be said that it was a busy period. And the coming year will be a time of challenges and interesting initiatives for the Polish capital market.
It will start at the beginning of the year Polish six-month presidency of the Council of the European Union. This is an excellent time to pay attention to European capital markets, including: in the context of the Capital Markets Union.
New services for market participants
In January 2024, the KDPW Group made seven new statistical reports available on the Data.kdpw.pl data portal. Six are available as part of paid packages, and one has expanded the set of reports available for free.
Thanks to changes in the Shareholder Identification application, listed companies received tools to facilitate the running of loyalty programs for shareholders. New application functions provide companies with the ability to receive periodic reports revealing the identity of shareholders and the status of shares they hold, as well as convenient filtering of the received data.
The EMIR 3.0 regulation introduces obligation for EU market participantswho settle certain OTC derivatives in EUR and PLN in CCPs from third countries, directly or indirectly, the so-called an active account, i.e. at least one settlement account in an EU authorized CCP. This service was offered by the clearing house KDPW_CCP, part of the KDPW Group. KDPW_CCP offers new clearing participants, among others: exemption from the fee for entry into the register of clearing participants in 2025. (saving PLN 50,000), attractive participation fee, asset segregation, simple process of opening an active account, online access to the settlement system and a free test environment.
Anniversary year
The year 2024 is special for the National Depository of Securities and its stakeholders. It has been 30 years since KDPW, and now the KDPW Group, has been providing services post-trade services for the financial market.
During the ceremony summarizing the 30th anniversary of the National Depository, which took place on November 5, 2024, at the Polish History Museum in Warsaw, awards were given to participants of the KDPW Group. The awards were granted for activity and commitment in cooperation with the KDPW Group and for contributing to the development of the capital market. And they were awarded to: Bank Handlowy w Warszawie, Bank Pekao, BM Bank Pekao, DM BOŚ, Erste Securities Polska, ING Bank, mBank, PKO Bank Polski and XTB.
2024 is also the 10th anniversary of the EMIR Trade Repository at KDPW. During this period, the National Depository for Securities accepted 6.6 billion reports concerning 2 billion transactions. A decade ago, RT EMIR had 73 participants. Currently, 280 entities, including 40 foreign ones, participate in the Trade Repository at KDPW.
Challenges of the future: Capital Markets Union
One of the biggest challenges faced by the KDPW Group, but also the entire Polish capital market, is the issue related to… Capital Markets Union. Mario Draghi’s report indicates that Europe needs innovation, and compared to the American or Chinese markets, it has very limited access to financing through the capital market, which most supports innovation and productivity of the economy.
Europe, unlike e.g. the USA, is not a single capital market, it is made up of many smaller and larger markets with different traditions and legal regimes. The challenge is to participate in the creation of solutions that will allow the capital market to increase its ability to finance the economy on a European scale while maintaining regional markets, including an increasingly stronger capital market financing the Polish economy.
Despite the globalization of financial markets, local companies are invested primarily by local capital, i.e. Polish companies from the SME sector will be financed by the domestic capital market. Therefore, a bold policy to support capital building in the country is necessary. This requires incentives, e.g. incentives in the form of tax breaks to convert part of savings into capital available on the stock exchange, or a different approach to taxing savings and taxing investment income.
For the development of the capital market in Poland, it is also necessary to include it in the country’s economic development strategy.
T+1 cycle
On November 18, 2024, ESMA (European Capital Market Authority) recommended that the settlement of transactions in the European Union should take place in the model T+1 instead of the current T+2.
The recommendation to switch to the T+1 cycle only in 2027 results from the fact that there are many currencies, legal systems and infrastructure institutions on the European market. The lack of harmonization in the area of corporate law in individual EU countries is of particular importance. The transition from the T+2 to T+1 settlement cycle will therefore be a legal, technological and investment challenge for all market participants – from infrastructure institutions, through supervisors, legislative authorities, to investment companies and banks.
The National Depository has already initiated a series of meetings with participants of the Polish capital market in order to identify barriers and develop necessary solutions that will ensure the possibility of effective operation in a shortened settlement cycle.
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