Sberbank and BK Region with participation of NSD concluded the first-ever tripartite repo transaction based on a blockchain

Sberbank announced on December 6, 2018 that it together with Region broker company and with the assistance of NSD concluded and calculated the first-ever tripartite bargain of an off-exchange repo using the smart contract in network a blockchain.

The first tripartite repo transaction concluded using the smart contract in network a blockchain — the next important step on the way of business process automation in work of Sberbank with partners in financial markets. Consolidation of smart contracts and the principle of work of technology of the distributed registers do financial transactions more transparent and protected both for the client, and for bank. We are sure that the technology developed by us will become the new market standard of the conclusion of transactions of an off-exchange repo and market participants will appreciate all its opportunities — Andrey Shemetov, the vice president of Sberbank, the Head of Department of global markets said.

The transaction represents ruble off-exchange a repo, provided with federal loan bonds. From the legal point of view, the transaction is regulated by Russian law and is the financial contract obliging for the parties signed in an electronic format using the smart contract and electronic digital signatures through SUO NSD.

Integration of SUO NSD into distributed networks a blockchain is a part of our development strategy. Application a blockchain in service of a repo — one of the few examples of justified use of this technology. Independence of the calculations performed in the smart contract and neutrality of NSD as agent on management of providing, in a combination give the flexible, reliable and progressive mechanism for carrying out transactions in curb market. Within the pilot transaction of NSD acted not only settlement depositary, but also provided participants with services for management of providing, acted as the supplier of market data which were used in calculations of the smart contract — Alina Akchurina, the Managing director for development of management systems for providing NSD told.

Three parties — the seller on behalf of Sberbank, the buyer on behalf of BK the Region and the calculation agent on behalf of NSD participate in the transaction. Interaction between all parties is completely automated and there is within network a blockchain. Each of participants of the transaction gave order to the note to network a blockchain then the smart contract concluded the bargain and submitted settlement instructions to the clearing system of NSD. For carrying out calculations the SUO NSD platform was used that allowed the parties of a repo to automate work on execution of compensation contributions, settlement functions and a reporting in a repository, explained in Sberbank.