Founded in 2005 as a public joint stock company, Central Securities Depository of Iran (CSDI) is the sole registry entity in the Iranian capital market. Enjoying a history of 50 years, the Iranian capital market was demutualized in 2005 and as a result, CSDI was legally segregated from the rest of the capital market and commenced to work as an independent and separate entity. It is the central registrar and clearing house for all the exchanges in Iran i.e. Tehran Stock Exchange (TSE), Iran FaraBourse (IFB), Iran Mercantile Exchange (IME), and Iran Energy Exchange (IRENEX). It takes over the registry, clearing, and settlement issues related to equity, Islamic securities (Sukuk), derivatives, energy contracts, electricity, mercantile products etc.
CSDI is in fact the official data and infrastructure provider of the whole Iranian capital market and indirectly serves as a gateway for both local and international investors. Responsible for taking care of pre- and post-trade-related tasks, ranging from the registry and deposit of securities to the clearing and settlement of the transactions carried out in the financial market, it also plays a crucial role in managing systemic and systematic risks. To this purpose, CSDI has designed and launched the service of Settlement Guarantee Fund (SGF) and a Comprehensive Risk Management Program, along with other instruments, towards managing the risks related to the clearing house. Taking advantage of SGF service, the investors can to a large extent be assured of the fact that in case a party fails to meet the trade settlement obligations within the set time, the clearing house will be able to fulfill the obligations of the defaulting member within the settlement day.
CSDI acts based upon the rules and regulations passed by the Iranian Parliament, the High Council of the Iranian Capital Market, and the Securities and Exchange Organization of Iran (SEO) as the supervisory and regulatory body of the entire capital market.
CSDI main beneficiaries are the four exchanges of the Iranian capital market together with brokers, local and foreign shareholders, issuers, investment funds, investment banks, asset management companies, financial information processing companies, and the judiciary.
CSDI is currently parent company of two subsidiary companies:
- SAMAT Samaneh: that has been established to provide IT services to CSDI
- Capital Market Central Asset Management Company: responsible for establishing and managing SPVs, in order to facilitate implementation of intermediary actions in Iran's capital market.
The structure of the capital market in Iran and the status of CSDI, based on the present definitions in the Securities Market Act of the Islamic Republic of Iran, the Law for Development of New Financial Instruments and Institutions and the common norms in the capital market in Iran, are shown in the following chart:
Founded in 2005 as a public joint stock company, Central Securities Depository of Iran (CSDI) is the sole registry entity and custodian in the Iranian capital market using the hybrid registry system with a fully dematerialized book entry system. Enjoying a history of 45 years, the Iranian capital market was demutualized in 2005 and as a result, CSDI was legally segregated from the rest of the capital market and commenced to work as an independent and separate entity. It is the central registrar and clearing house for all the exchanges in Iran including Tehran Stock Exchange
CSDI is in fact the official data provider, the official counterparty to jurisdiction, and it serves as a gateway and platform provider for the international investors. Responsible for taking care of post-trade-related tasks, ranging from the deposit and registration of securities to the clearing and settlement of the transactions carried out in the financial market, it plays a significant role in managing systemic and systematic risks