Indian Clearing Corporation Limited (ICCL) undertakes the clearing and settlement activities for all deals executed on the Commodity Derivatives segment. ICCL acts as legal counter-party to all deals on BSE'S Commodity Derivatives segment and guarantees settlement.
The Clearing Members shall be responsible for all obligations, inter alia, the payment of margins, settlement obligations, penalties, any other levies etc. pertaining to the trades entered by them as trading members and also of those trading members and custodial participants, if any, for whom they have undertaken to settle as a Clearing Member.
As a set process, all obligations in respect of trades entered by trading members will be transferred to the respective Clearing Members who have undertaken to settle as Clearing Members for them.
Clearing Bank
ICCL has empanelled the following 20 Clearing Banks to provide banking services to members for clearing & settlement purpose.
List of Clearing Banks
| 1 |
Axis Bank Limited | 022-40867528 /29 /30 |
| 2 |
Bank Of Baroda | 022-40468314 |
| 3 |
Bank Of India | 022-22722396 |
| 4 |
Canara Bank | 022-22023166/67 |
| 5 |
Central Bank of India | 022-22623148 |
| 6 |
Citibank N.A. | 022-42343359 / 61 |
| 7 |
Corporation Bank | 022-22671251 |
| 8 |
Deutsche Bank AG | N.A. |
| 9 |
HDFC Bank Limited | 022-30753252 /48 |
| 10 |
Hong Kong and Shanghai Banking Corporation Limited | 022-45053308/09/10 |
| 11 |
ICICI Bank Limited | 022-66673966 / 68 |
| 12 |
IDBI Bank Limited | 022-66700637 /73 / 84 |
| 13 |
IndusInd Bank Limited | 022-61069389 / 92 / 21 |
| 14 |
Kotak Mahindra Bank Limited | 022-66056662 /63/ 67 /68/70 |
| 15 |
Punjab National Bank | 022-26530196 / 97 |
| 16 |
Standard Chartered Bank | 022-61157288 / 7685 |
| 17 |
State Bank Of India | 022-22719120 /21/22 |
| 18 |
Union Bank of India | 022-22629332 / 33 / 35 |
| 19 |
Yes Bank Limited | 022-33477220 |
| 20 |
J P Morgan Chase Bank N.A. | 022-61575126 / 022-61573843 |
|
The Clearing Members may use their existing settlement accounts with any of the empanelled clearing banks or open a separate settlement account for Funds settlement of Commodity Derivatives Segment. The settlement account to be used for clearing and Settlement operations i.e., for settling funds obligations, payment of margins, penalty charges, etc. as may be specified by ICCL from time to time.
Procedure for change in designated Clearing Bank
In case a Clearing Member wishes to shift their settlement account from one designated Clearing Bank to another, the following procedure is to be followed:
- The Clearing Member will have to submit their request letters (on their letterhead) of their intent to shift their settlement account from one designated Clearing Bank to another, to ICCL as per the below format.
- As soon as the formalities are completed, ICCL will inform the member in writing about the date from which they can start their clearing and settlement operations from new designated Clearing Bank. However, till such time, ICCL will continue to debit /credit the member's existing clearing bank account.
Format of member's request letter for change of Designated Bank
Date:
Manager,
Indian Clearing Corporation Ltd. (ICCL)
Phiroze Jeejeebhoy Towers
Dalal Street, Fort Mumbai - 400 001
Dear Sir,
Re: Change of Designated Bank for Clearing & Settlement Purpose
I/We _________________________ Clg.No._________ is/ are having A/c. No.___________ with ____________________ Bank for margins /clearing & settlement obligations of ICCL – BSE Commodity Derivatives Segment. I/We wish to shift my / our designated bank from _________________________ to ____________________________ bank.
Our Account No. with _______________________ bank is _________________________ and we wish to designate the same for Clearing & Settlement purpose including margin payments for ICCL – BSE Commodity Derivatives Segment.
I/We agree that the operations in the abovementioned account would start only after receiving intimation regarding the same from ICCL.
You are requested to please do the needful. Signature & Stamp of the Member(s) / Director(s)
Name & Signature
Stamp of the Member(s) / Director(s)
Settlement Process
- Funds settlement for trades done on BSE Commodity Derivatives Segment will be cleared and settled on a netted basis for daily settlement obligations & for delivery obligations.
- The delivery obligations of commodities will be settled on gross basis.
Settlement period
Daily Settlement
The daily mark-to-market settlement of commodity futures contracts would be cash settled on T+1 day as per the timelines specified by ICCL.
Final Settlement
The final settlement of commodity futures contracts will be effected as per the timelines specified by ICCL in the respective product specification circular issued from time to time.
Settlement Timelines
Settlement of admitted deals will be in accordance with the settlement timelines prescribed by ICCL from time to time.
The settlement timelines for pay-in and pay-out are defined as under
| Mark to Market |
Daily |
T+1 |
Pay-in: 8:30 am
Pay-out: By 11:00 am |
| Delivery (Final Settlement- at expiry) |
As defined in delivery settlement procedure & settlement calendar of the respective commodity. |
As defined in delivery settlement procedure & settlement calendar of the respective commodity. |
Pay-in: By 11:00 am
Pay-out: As defined in delivery settlement procedure |
|
Timings for submission of Delivery Intentions
The timings for submission of delivery intentions to ICCL (during specified working days) is as specified in respective contract specifications and the same are reiterated as under:
| Gold, Silver |
Monday to Friday |
Up to 07:30 pm |
Up to 08:00 pm |
|
ICCL shall disclose on its website the delivery intent of the hedgers on a daily basis in an anonymous manner.
Settlement Price
Settlement price for settlement of contracts in the Commodity Derivatives segment are specified as under
Daily Settlement Price for mark to market settlement of commodity futures contracts
VWAP (Volume Weighted Average Price) of all trades done during the last 30 minutes of the trading day, subject to minimum 10 trades.
If the number of trades during last 30 minutes is less than 10, then it is based on the VWAP of the last 10 trades executed during the day.
If number of trades done during the day is less than 10 or no trades have been executed in a contract on a particular trading day, then the close price will be computed theoretically.
Final Settlement Price for commodity futures contracts
During staggered delivery period,
The delivery settlement price during the staggered delivery period will be the daily settlement price of the particular contract as specified in the contract specification. The price arrived at as above will be adjusted by applying freight adjustment factor /Discount/Premium on up country delivery and the discount / premium in respect of quality, quantity etc. in accordance with the adjustments specified in the Contract Specifications.
The location premium/discount will be determined and disclosed prior to launch of the contract in various commodities
On the day of Contract Expiry,
All open positions will be marked for delivery at the Final settlement price of the particular commodity. Final Settlement Price (FSP) is determined by polling, unless specifically approved otherwise, the FSP shall be arrived at by taking the simple average of the last polled spot prices of the last three trading days viz.,E0 (expiry day), E-1 and E-2. In the event the spot price for any one or both of E-1 and E2 is not available; the simple average of the last polled spot price of E0, E-1, E-2 and E-3, whichever available, shall be taken as FSP. Thus, the FSP under various scenarios of non-availability of polled spot prices will be as under:
| 1 |
Yes |
Yes |
Yes |
Yes/No |
E0, E‐1, E‐2 |
| 2 |
Yes |
Yes |
No |
Yes |
E0, E‐1, E‐3 |
| 3 |
Yes |
No |
Yes |
Yes |
E0, E‐2, E‐3 |
| 4 |
Yes |
No |
No |
Yes |
E0, E‐3 |
| 5 |
Yes |
Yes |
No |
No |
E0, E‐1 |
| 6 |
Yes |
No |
Yes |
No |
E0, E‐2 |
| 7 |
Yse |
No |
No |
No |
E0 |
|
In case of non-availability of polled spot price on expiry day (E0) due to sudden closure of physical market under any emergency situations noticed at the basis centre, BSE will decide on further course of action for determining FSP in consultation with SEBI.
The price arrived at as above shall be adjusted by applying freight adjustment factor /Discount/Premium on up country delivery and the discount / premium in respect of quality, quantity etc. in accordance with the adjustments specified in the Contract Specifications.
Delivery Settlement Calendar:
ICCL shall issue a settlement calendar in advance, stipulating the various activity schedule such as Funds Pay-in and Funds Pay-Out, Commodity Pay-in and Commodity Pay-out, settlement of variance in weight & grade, delivery penalties, settlement dues amount etc.
Members should refer the settlement calendar issued by ICCL from time to time.
Delivery Allocation Details
The allocation details of the commodity shall be available in the Collateral Management System.
The allocation details would inter alia cover the variances in the weight & grade, location premium/discount amount, settlement dues amount, values of the final settlement amount etc.
Early pay-in
An early pay-in facility is being provided in ICCL Collateral Management system to clearing members for earmarking idle balance of deposited commodities towards early pay-in against sell position of relevant futures contracts.
Clearing Members having idle/free commodity can earmark the idle/free balance towards early pay-in of commodity against their existing short open positions for availing the benefits of margin exemption.
For such short positions against which early pay-in has been made, based on risk perception, will be exempted from imposition of all types of margins levied. However, ICCL shall continue to collect mark to market margins from such market participants against such positions.
In case of compulsory delivery contracts, delivery to the extent of open position at the expiry of the contract will be mandatory after claiming early pay-in facility on the position.
Give-up/Take-up facility
Members can give-up trades pertaining to their Custodial Participant clients who want to settle their trades through other Clearing Members. The Clearing Members of the custodial participants need to confirm such trades to take-up the positions for settlement. Such trades are to be confirmed by the Clearing Members in such manner, within such time and through such facility as may be provided to Clearing Members from time to time by BSE/ICCL. The trades which have been confirmed by Clearing Members will form part of the obligations of concerned Clearing Members and the Clearing Members will be responsible for all obligations arising out of such trades including the payment of margins, penalties, any other levies and settlement of obligations. In case of trades which have not been confirmed by the Clearing Members of the Custodial Participants, the same will be considered as trades pertaining to the Trading Members entering such trades and forming a part of the obligations of Clearing Members, who clear and settle for such Trading Members.
For Additional details Members may refer the below Circular:
Clearing & Settlement Process