MT541 & MT543 – Receive / Deliver against Payment
The European ISO 15022 Settlement Implementation Group
Introduction 3
Contributing Institutions 3
Custodians 3
Fund Managers 3
References 4
MT541/3 – Receive/Deliver against Payment 5
Notes 6
MT540/2 – Receive/Deliver Free 12
MT540-3 – Cancellation 12
MT540-3 – Cancellation with Underlying FX 12
MT540-3 – Fax Sheet(s) 13
Change record from version 1.0 to 1.1 16
Change record from version 1.1 to 1.2 16
MT540-3 – Examples 16
Introduction
The European ISO 15022 Settlement Implementation Group is an industry led initiative.
Its objective is to produce documentation that describes the use of ISO 15022 settlement messages between custodian and fund managers, in order to provide a common and agreed protocol for a fund manger to follow with each of their custodians.
This document endorses and conforms to the Securities Market Practice Group (SMPG).
It is based on a series of meetings called independently by fund managers who are implementing ISO 15022, involving the custodians named below.
Reconciliation messages are to be addressed later.
Corporate Actions messages are NOT to be addressed (custodians and fund managers are already represented on the UK&IE Corporate Action Market Practice Group) and fully support the corporate action market practice.
Contributing Institutions
Custodians
Bank of New York;
Citi;
Deutsche Bank;
HSBC;
JPM Chase;
Northern Trust;
State Street.
Fund Managers
Barclays Global Investors;
Fidelity;
Gartmore Investment Management plc;
Goldman Sachs Asset Management;
Invesco (using templates proposed by FMC);
Morley;
Newton.
References
1. SWIFT User Handbook September 2001. Shipped to all SWIFT members in September 2001.
2. Spreadsheet Summary of SMPG Country Specific Market Practices, version 0.6. Supplied with this document. Note, this document is not supported by SMPG or SWIFT.
3. SMPG Common Elements, Final – November 2000. Available on
4. SMPG Country Specific Market Practices – as at January 2002. Available on
5. SMPG Place of Settlement, Final – March 2001. Available on
6. SMPG Place of Safekeeping, Final Draft – November 2001. Available on
7. Place of Settlement and Place of Safekeeping. Supplied with this document. Note, this document is not supported by SMPG or SWIFT.
8. SMPG proposed market practice for cancellation of transactions containing underlying FX instructions, First Draft – November 2001.
MT541/3 – Receive/Deliver against Payment
This template shows the fields a fund manager should supply to a custodian in a settlement instruction.
There are four types of data:
• The business data agreed by SMPG to be common in all markets, and thus mandated, are in bold, (see Reference 3).
• Data used in country specific and ICSD market practices are indicated by a hatched yellow background, (see Reference 4).
• Additional data supplied by fund managers are indicated by a grey background, this data is supplied as appropriate for the trade and/or for the market, with one special case –
Place of Safekeeping.
Note that the Place of Safekeeping is not mandated. It is optional and supplied when possible, however, its provision is dependent on the individual service level agreement between the Fund Manager and the Custodian.
• Structural fields required by the message syntax in italic, e.g. start and end of sequence and identification of the settlement instruction as a trade, (see Reference 1).
An entry of “Y” in the FI column indicates use of the field with fixed income instruments only.
|Field Tag |Format |Field Name/Description |FI only |Note |
|:16R:GENL | |Sequence A General Information – start | | |
|:20C::SEME// |16x |Sender’s Message Reference, the Fund Manager’s transaction reference | | |
|:23G:NEWM | |Function of Message, NEWM indicates a new message, (not a cancellation) | | |
|:16S:GENL | |Sequence A General Information – end | | |
|:16R:TRADDET | |Sequence B Trade Details – start | | |
|:94B::TRAD// |4!c[/30x] |Place of Trade | |1 |
|:98A::SETT// |8!n |Settlement Date | | |
|:98A::TRAD// |8!n |Trade Date | | |
|:90a::DEAL |various |Deal Price | |2 |
|:99A::DAAC// |[N]3!n |Number of Days Accrued |Y |3,22 |
|:35B: |[ISIN1!e12!c] |Security Identifier ISIN preferred | |4 |
| |[4*35x] | | | |
|:16R:FIA | |Sequence B1 Financial Instrument Attributes – start | | |
|:98A::MATU// |8!n |Maturity Date when interest bearing security becomes due and principal is |Y |22 |
| | |paid | | |
|:92A::INTR// |[N]15d |Interest Rate of an interest bearing security |Y |22 |
|:16S:FIA | |Sequence B1 Financial Instrument Attributes – end | | |
|:22F::TTCO// |4!c |Trade Condition, supplied as applicable | |5 |
|:11A::4!c// |3!a |Foreign Exchange Instruction. Currency to Buy or Sell | |6 |
|:70E::SPRO// |10*35x |Settlement Instruction Processing Narrative | |7 |
|:16S:TRADDET | |Sequence B Trade Details – end | | |
|:16R:FIAC | |Sequence C Financial Instrument / Account – start | | |
|:36B::SETT// |4!c/15d |Quantity | |8 |
|:97A::SAFE// |35x |Safekeeping Account, the client’s safekeeping account at the custodian | | |
|:94a::SAFE |various |Place of Safekeeping – if different from Place of Settlement | |9 |
|:16S:FIAC | |Sequence C Financial Instrument / Account – end | | |
|:16R:SETDET | |Sequence E Settlement Details – start | | |
|:22F::SETR//TRAD | |Type of Settlement Transaction, TRAD indicates a trade | | |
|:22F:: |various |Country Specific Settlement Conditions and Overrides | |10-15 |
|:16R:SETPRTY | |Sub Sequence E1 Settlement Parties – start | | |
|:95a:: |Various |Delivering or Receiving agent, of trading counterparty | |16 |
|:97A::SAFE// |35x |Safe keeping account owned by the agent | |17 |
|:16S:SETPRTY | |Sub Sequence E1 Settlement Parties – end | | |
|:16R:SETPRTY | |Sub Sequence E1 Settlement Parties – start | | |
|:95a:: | |Client of the Receiving or DeliveringAgent, Trading parties | |18 |
|:97A::SAFE// |35x |Safe keeping account owned by the trading party | |17 |
|:16S:SETPRTY | |Sub Sequence E1 Settlement Parties – end | | |
|:16R:SETPRTY | |Sub Sequence E1 Settlement Parties – start | | |
|:95a:: | |Place of Settlement, of trading counterparty | |19 |
|:16S:SETPRTY | |Sub Sequence E1 Settlement Parties – end | | |
| | |Sub Sequence E2 Cash Parties – used with receipts | |20 |
|:16R:AMT | |Sub Sequence E3 Amounts – start | | |
|:19A::SETT// |3!a15d |Settlement Amount where 3!a is the currency and 15d the amount | | |
|:16S:AMT | |Sub Sequence E3 Amounts – end | | |
|:16R:AMT | |Sub Sequence E3 Amounts – start | | |
|:19A::4!c// |3!a15d |Other Amounts supplied by the Fund Manager. | |21 |
|:16S:AMT | |Sub Sequence E3 Amounts – end | | |
|:16S:SETDET | |Sequence E Settlement Details end | | |
Notes
1. Place of Trade
Two formats are used:
• An on-exchange trade, the exchange is identified by its Market Identifier Code (MIC), the first four characters of the BIC of the exchange.
:94B::TRAD//EXCH/4!c
• An over the counter trade, the place of trade may be optionally identified further by up to thirty characters of free text.
:94B::TRAD//OTCO[/30x]
2. Deal Price
Mandatory for fund accounting. Two formats are possible:
• Fixed Income instruments use format option A for percentage-based or yield-based prices, :90A::DEAL//4!c/15d where 4!c indicates whether the price is percentage “PRCT” or yield “YIEL”, for example a percentage of 102.35% is
:90A::DEAL//PRCT/102,35
• Other instrument types use format option B, :90B::DEAL//4!c/3!a15d where 4!c indicates the actual amount “ACTU”, and the remainder of the field is a concatenation of the currency code and the price, for example a price of $24.77 US is
:90B::DEAL//ACTU/USD24,77
3. Number of Days
Used for calculating the accrued interest amount, three digits must be used, for example, a positive number :99A::DAAC//014
And for example, a negative number :99A::DAAC//N011
4. Security Identifier
Security line 1 – if ISIN known
“ISIN ” + ISIN Note that this is the text “ISIN” with a space before the ISIN code
Security line 1 – if ISIN not known but SEDOL known
“/GB/” + SEDOL
Security line 1 – if ISIN and SEDOL not known but CUSIP known
“/US/” + CUSIP
Security line 2-5 – optional – the Security Description
If none of ISIN, CUSIP, SEDOL are known,
then Security lines 1-5 may be used for the Security Description
5. Trade Conditions
Values used by fund managers and custodians are (others are detailed in Reference 1):
CCPN Trade was executed cum coupon.
CDIV Trade was executed cum dividend.
SPCU Special cum dividend - bought after the ex date and getting a dividend.
SPEX Special ex dividend - sold before the ex date without the coupon.
XCPN Trade was executed ex coupon.
XDIV Trade was executed ex dividend.
6. Foreign Exchange Instruction
Instructs the custodian to execute an FX deal to cover the settlement amount. Used in a small number of markets.
On a receipt (MT541) the instruction indicates the currency to be sold to cover the settlement amount. For example :11A::FXIS//USD
On a delivery (MT543) the instruction indicates the currency to be bought with the settlement amount. For example :11A::FXIB//EUR
7. Settlement Instruction Processing Narrative
Used only for non-standard trades where the Fund Manager requires the custodian to process the settlement instruction manually, use of the narrative field indicates this. Not to be used for information which may be carried in a structured format elsewhere in the message.
8. Quantity
where 4!c is FAMT for Fixed Income instruments or
where 4!c is UNIT for equities (non-fixed income) or
where 4!c is AMOR for amortized instrument.
9. Place of Safekeeping
See the European ISO 15022 Settlement Implementation Group paper on Place of Settlement and Place of Safekeeping, (Reference 7) and the SMPG Place of Safekeeping document, (Reference 6) and examples, used when securities are not held at the Place of Settlement (Reference 5).
It is increasingly important for the fund manager/client to supply the Place of Safekeeping. This is advantageous for the client because where a client has securities, of the same type, that are safekept at more than one location, or can be settled at more than one location, and instructs only the PSET (of the counterparty, as per SMPG) the instruction is likely to be routed to the client's account at the same place as the PSET. This is not always what is required. For example: if the client holds Frankfurt eligible securities in Euroclear and wants to deliver from Euroclear to Frankfurt, they would quote a PSET of the German BIC, BUT the securities, via default, would be delivered from the client's Frankfurt account NOT their Euroclear Account. By including a Place of Safekeeping as Euroclear, the ambiguity is removed.
Other scenarios are likely where the security may be held at more than one place, for example: a trade in the Irish market may be settled with securities held directly at CREST or with securities held with a local custodian; a similar scenario is possible where settlement is for Clearstream (Clearstream or local Luxembourg subcustodian).
An additional example is the scenario where a fund manager buys a security on the Norwegian exchange (settles in Norway on VPS) and immediately on-delivers in a trade in Finland (settles in APK). It is important that the fund manager indicates that the place of safekeeping is the custodian in the Norwegian market in order to achieve efficient settlement in Finland.
Also note that any split holding, no matter how quickly resolved, may result in a further split holding as a result of a corporate action.
10. Settlement Condition – Physical Settlement
:22F::STCO//PHYS used when physical settlement required, applies to certain markets only. Note that when used, the Place of Settlement must be format option C and be a country code, (see note 19).
11. Settlement Condition – Split Settlement
:22F::STCO//SPST used when stock and cash settle separately. The Cash Settlement Party details will be supplied in this case, (see note 20).
12. Beneficial Ownership Override Indicator
:22F::BENE//NBEN Although the standing instruction is to change the beneficial ownership, it is for this settlement required to override the standing instruction, i.e., not to change the beneficial ownership. If no standing instruction in place, the instruction is not to change the beneficial ownership.
:22F::BENE//YBEN Although the standing instruction is not to change the beneficial ownership, it is for this settlement required to override the standing instruction, i.e., to change the beneficial ownership. If no standing instruction in place, the instruction is to change the beneficial ownership.
Required in some markets, e.g. Portugal.
13. Settlement System Override Indicator
:22F::RTGS//NRTG Although the standing instruction is to settle through the RTGS system, it is for this settlement required to override the standing instruction, i.e., settle through the non-RTGS system. If no standing instructions in place, the instruction is to settle through the non-RTGS system.
:22F::RTGS//YRTG Although the standing instruction is to settle through the non-RTGS system, it is for this settlement required to override the standing instruction, i.e., settle through the RTGS system. If no standing instructions in place, the instruction is to settle through the RTGS system.
14. Registration Override Indicator
:22F::REGT//NREG Although the standing instruction is to register on receipt, it is for this settlement required to override the standing instruction, i.e., to hold the securities in street name. If no standing instructions in place, the instruction is to hold the securities in street name.
:22F::REGT//YREG Although the standing instruction is to hold the securities in street name on receipt, it is for this settlement required to override the standing instruction, i.e., to register the securities. If no standing instruction in place, the instruction is to register the securities.
15. Stamp Duty Indicator
:22F::STAM/xxxx/4!c where xxxx is the data source scheme –
• CRST for UK&IE, supply this only when the custodian is accountable for the stamp and not the broker;
• STRA for ZA (HK yet to decide on format) and 4!c is the local coder. See Reference 2.
16. Delivering or Receiving Agent
The agent acting for the broker. Must be included in the message. Delivering Agent (DEAG) in MT541 and Receiving Agent (REAG) in MT543.
The preferred format is a BIC (e.g. :95P::DEAG//AGNTNL3A) or a proprietary code, (e.g. in the UK :95R::REAG/CRST/56322). A summary of the market requirements is given in Reference 2.
17. Safekeeping Account of Agent or Trading Party
The safekeeping account of the agent or trading party is required in some country specific market practices. A summary of the market requirements is given in Reference 2.
18. Client of the Receiving or Delivering Agent
The broker. Must be included in the message. Seller (SELL) in MT541 and Buyer (BUYR) in MT543.
The format is a BIC (e.g. :95P::SELL//BROKGB2L) or the proprietary code if required by the country market practice.
19. Place of Settlement
The broker’s Place of Settlement. (The fund manager’s Place of Safekeeping must be supplied when the fund manager requires delivery into an account at a place different to the broker’s PSET. The place of safekeeping simply indicates where the fund manager expects the securities to be delivered from or received into. See note 9)
The format is either a BIC (e.g. :95P::PSET//CRSTGB2L) or, when settlement is physical, an ISO country code (e.g. :95C::PSET//GB for physical settlement of a unit trust in UK) (see note 10).
See References 5 and 6. SMPG publish a working list of PSET BICs on groups..
20. Cash Parties
Used for receipts when cash and stock settle separately (:22F::STCO//SPST see note 11).
Account with Institution is the broker’s bank. This may be format 95P – a BIC, format 95R – a proprietary code, e.g. a GB sort code or a US ABA number, or a Name and Address – 95Q.
Examples:
:95P::ACCW//BANKDEFX A BIC
:95R::ACCW/GBSC/010203 A GB sort code
:95R::ACCW/USFW/034450206 An ABA number
:95Q::ACCW//BANK OF RURITANIA Gmbh A Name & Address
The Beneficiary of Money is the broker. This may be format 95P – a BIC, or a Name and Address – 95Q.
Examples:
:95P::BENM//BROKGB2L A BIC
:95Q::BENM//JOE SOAP BROKERS LTD A Name & Address
The Cash Account of the broker at the broker’s bank (the CASH account of the BENM at the ACCW). Format 97A
Example:
:97A::CASH//123ABCD An account identifier
|:16R:CSHPRTY | |Sub Sequence E2 Cash Parties – start |
|:95a::ACCW// |various |Account with Institution |
|:16S:CSHPRTY | |Sub Sequence E2 Cash Parties – end |
|:16R:CSHPRTY | |Sub Sequence E2 Cash Parties – start |
|:95a::BENM// |various |Beneficiary of Money |
|:97A::CASH// |34x |Cash Account, of Beneficiary at Account with Institution |
|:16S:CSHPRTY | |Sub Sequence E2 Cash Parties – end |
21. Other Amounts
Other amounts may be supplied by the Fund Manager, some are market dependent (see Reference 2), others are required for fund accounting. The main ones are:
• Deal Amount :19A::DEAL//3!a15d (Stampable Consideration in UK&IE)
• Broker’s Commission :19A::EXEC//3!a15d
• Charges & Fees :19A::CHAR//3!a15d
• Other Fees & Charges :19A::OTHR//3!a15d
• Accrued Amount :19A::ACRU//3!a15d used with fixed income instruments
• Stamp Duty :19A::STAM//3!a15d the stamp duty associated with the transaction
• Local Broker’s Commission :19A::LOCO//3!a15d
• Stock Exchange Tax :19A::STEX//3!a15d.
Note that:
• Amounts (other than Settlement Amount) are optional;
• Any amount valid in ISO 15022 may be supplied;
• The aim is to converge the amounts used in settlement instructions with those output from electronic trade confirmation systems e.g. GSTP and OMGEO (both of which are ISO 15022 compliant), and trading systems, e.g. OASYS.
22. Fixed Income Instrument Data in the FIA sequence of the Settlement Instruction
This data may be derived from the base data of the security, if known. It is supplied by the Fund Manager typically for new or short term securities where the base data may not be available to the market as a whole.
MT540/2 – Receive/Deliver Free
The message formats are the same as the MT541 and MT543, with the exception of the following fields:
• Sequence B, Deal Price – not present
• Subsequence E3, all Amount fields – not present.
MT540-3 – Cancellation
The MT540-3 cancellation instruction is formatted in the same way as the original (:23G:NEWM) settlement instruction, with the following differences:
• The function of the message is a cancellation
• There is a cross-reference to the original settlement instruction.
The changes are in the Sequence A General Information which is shown below.
|:16R:GENL | |Sequence A General Information – start |
|:20C::SEME// |16x |Sender’s Message Reference, the Fund Manager’s cancellation reference |
|:23G:CANC | |Function of Message, CANC indicates a cancellation message, (not a new |
| | |message) |
|:16R:LINK | |Sub Sequence A1 Linkages – start |
|:13A::LINK// |3!c |MT number of the message being cancelled |
|:20C::PREV// |16x |The Fund Manager’s transaction reference of the message being cancelled |
|:16S:LINK | |Sub Sequence A1 Linkages – end |
|:16S:GENL | |Sequence A General Information – end |
| | | |
|Message continues as the original |
• Note that the MT number of the message being cancelled (field 13A) is optional.
• It is not necessary to cross reference the replacement instruction to either original or the cancellation.
• The remaining sequences of the message are the same as the original.
MT540-3 – Cancellation with Underlying FX
It is strongly recommended to use the dedicated FX instruction (MT380), when it becomes available in November 2002, and not include the FX in the settlement instruction because of the difficulties involved in cancellation.
In the meantime, when there is an underlying FX, the MT540-3 cancellation instruction is to be formatted following the cancellation section of the SMPG Securities Trade Forex Market Practice paper (Reference 8). Note that this paper is at the discussion stage.
MT540-3 – Fax Sheet(s)
For use only in extremely exceptional circumstances and by non-connected fund managers.
DATE: ______/______/______________ RECEIVE or DELIVER
FROM: ___________________________ AGAINST or FREE
TO: ___________________________
===============================================================
Sender’s Message Reference: _________________________________________
If CANCELLATION
MT Number cancelled: _ _ _ _ _ _ _ _
Message Reference to be cancelled: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
Place of Trade, Exchange EXCH/___________
Or Over the Counter OTCO/___________
Settlement Date: ____/____/________
Trade Date: ____/____/________
Choice of Deal Price formats: Percentage or Yield (circle as appropriate): ___________
Or Actual Amount: Currency: ________ Price: ___________
Number of Days Accrued: _____
Choice of Security Identifier: ISIN _________________
Or SEDOL _________________
Or CUSIP _________________
Maturity Date: ____/____/________
Interest Rate: _________________
Trade Condition, (circle as appropriate): CCPN, CDIV, SPCU, SPEX, XCPN, XDIV
Foreign Exchange Instruction (circle as appropriate): FXIB, FXIS Currency: ________
Settlement Instruction Processing Narrative:
__________________________________ __________________________________
__________________________________ __________________________________
__________________________________ __________________________________
__________________________________ __________________________________
__________________________________ __________________________________
Quantity (circle as appropriate): FAMT, UNIT, AMOR _________________
Safekeeping Account at Custodian _________________
Place of Safekeeping (circle as appropriate): NCSD, ICSD, CUST _________________
Settlement Transaction Type: ___________TRAD
Settlement Conditions (circle as appropriate) Physical? Y/N _____
Y/N Split Settlement? _____
Y/N Beneficial Override? _____
Y/N Settlement System Override? _____
Y/N Registration Override? _____
Stamp Duty Indicator _____
Agent (circle as appropriate) DEAG, REAG _________________
Agent’s Safekeeping Account _________________
Client of Agent (circle as appropriate) SELL, BUYR _________________
Client of Agent’s Safekeeping Account _________________
Place of Settlement _________________
Cash Parties: Account with Institution _________________
Beneficiary of Money _________________
Cash Account of Beneficiary _________________
Amounts: SETTLEMENT _________________
Deal _________________
Broker’s Commission _________________
Charges & Fees _________________
Other Fees & Charges _________________
Accrued Amount _________________
Stamp Duty _________________
Local Broker’s Commission _________________
Stock Exchange Tax _________________
AUTHORIZED BY (1): _________________________________________
AUTHORIZED BY (2): _________________________________________
Change record from version 1.0 to 1.1
Word Document
Note 15, page 9. The South African Data Source Scheme used for stamp codes changes from XJSE to STRA.
Spread Sheet
• Entry for Israel
from :95R::DEAG/XTAEIL/[DEL agent code]
to :95R::DEAG/XTAE/[DEL agent code]
• Entry for Portugal
from BIC (XCMVPTPP)
to BIC (XCVMPTPP)
Change record from version 1.1 to 1.2
Word Document
Note 15. Stamp Duty Indicator
'Supply this only when the custodian is accountable for the stamp and not the broker' moved to apply only to UK&IE. (and not come after, and therefore apply to HK&ZA)
Name now EISIG.
Spread Sheet
• Entry for Honk Kong
HK CSD BIC changed to
XHKCHKH1
from
HKSCHKH1
effective June 2002
• Entry for South Africa
South Africa Stamp Exemption Flag changed from ...
:22F::STAM/STRA/XDTY to
:22F::STAM/STRA/USTN
and preceeding cells changed to specify when flag used ... changed from ...
'Mandatory stamp duty indicator' to
'Optional stamp duty indicator for exemption or paid by broker'
Also cell above from ...
'E3 19A = Stamp duty amount' to
'E3 19A = Stamp duty amount - reporting only'
• Entry for UK
UK IMI's portfolio a/c number
Should be A1 COMM
• Entry for US
US PTC (Asstet Backed) now included in US DTCC
MT540-3 – Examples
[to be developed for a future version]
-----------------------
If CANCELLATION
MT Number cancelled: _ _ _ _ _ _ _ _
Message Reference to be cancelled: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
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