Asset Servicing

What It Offers

A wide range of transactions is offered to provide intermediaries and issuers with a complete and efficient system of administration for held securities, both Italian and foreign, centralised at Monte Titoli and belonging to the following categories:

  • Government bonds
  • Corporate bonds (including ABS)
  • Shares
  • Warrants/covered warrants
  • Mutual investment funds (closed-end funds, real estate funds and ETFs).

Financial instruments issued under Italian law are registered in Monte Titoli by the issuer itself, after the relevant issuer account is opened.

Placement and Deliveries

According to issuer's instructions, placements of new issuances, both on and off exchange, are processed on a real time basis; any subsequent FOP delivery instructed by intermediaries, even for the purpose of collateralization with Bank of Italy in order to obtain an increase in the credit line, is processed on a real time basis as well.

Thanks to the links with other national and international CSDs, cross-border FOP deliveries on a real time basis are granted, by means of the supported channels included in our connectivity offer.

A real time report is given to all intermediaries involved, both the sender and the beneficiary, to notify the status of each transaction and the change in the relevant holding positions (which is also reported in the daily account statement).

Mutual and Investment Funds

With reference to closed-end funds, real estate funds and ETFs (issued under Italian or foreign law), we ensure the processing of all the following transactions:

  • Centralisation of units in dematerialisation regime;
  • Payment of proceeds;
  • Unit redemption (at maturity date and upon request);
  • Deliveries, both FOP and DVP (DVP may be on a gross or net basis).

Corporate Actions

Thanks to the direct relationships between Monte Titoli and Italian issuing companies and the links with National and International CSDs, we receive corporate action announcements directly from the official source (the relevant issuer or Issuer CSD) and forward it immediately, with the same level of detail, to all our participants (via MT-X, SWIFT and RNI).

Monte Titoli is able to deal with each type of corporate action, by processing it in line with international standards:

  • Cash distributions (dividend payment, payment of proceeds and interest payment)
  • Securities distributions (i.e.: bonus right issue)
  • Distributions with option (i.e.: issuance of an option right)
  • Mandatory reorganisations (i.e.: merger, splitting, bond final redemption at maturity date)
  • Mandatory reorganisations with option (i.e.: issuance of outturning securities after the exercise of an option right)
  • Voluntary reorganisations (i.e.: warrant exercise, tender offer)
  • General meetings

The issuer should appoint a paying agent for cash settlement; Monte Titoli will send instructions to the relevant paying agent to process cash settlement automatically.

When payments are instructed by an Issuer CSD (where Monte Titoli is acting as the investor), we receive the payments and revert them immediately to our elected participants.

In case of payments in currency other than Euro (i.e.: USD, GBP) each affected intermediary should notify its correspondent bank for the relevant currency before the payment is processed.

Mandatory reorganisations are processed automatically on the basis of the instructions received from the issuer; voluntary reorganisations are processed on the basis of the instructions we receive from our elected participants (on behalf of the final investors) on a DVP basis in Target 2.

Our system to process corporate actions allows our participants to meet all their requirements:

Intermediaries

  • Receive a report relating to corporate actions, including the ones necessary to vote in annual meetings;
  • Automatically collect proceeds due on centralised financial instruments both in central bank money (euros) and in commercial bank money (other currency);
  • Have a complete report on proceeds settlement, both of a provisional nature and on the settlement date;
  • Participate in corporate actions on capital (capital increases, conversions, etc.) and events such as mergers and split-offs, by sending appropriate instructions to Monte Titoli, with any payment of the amounts due in central bank money (euros) or in commercial money (other currency).

Issuers

  • Have a privileged information channel to the financial system about all the existing operations and initiatives regarding the centralised financial instruments;
  • Have certainty and a guarantee of prompt payment of accrued proceeds and collection of amounts relating to corporate actions on capital against payment;
  • Have a complete settlement report both of a provisional nature and on the settlement date.

Tax Services

Monte Titoli supports domestic issuers in issuing bonds subject to tax under Law 239 of 1996 on the U.S. market (but support may also be extended to other international markets); the essential requirement is that the issuer is subject to the specified tax regime.

Since securities are subject to Italian taxation, American investors are exempt from payment of the 20% tax if they submit the appropriate self-certification foreseen by the law, because of the double taxation agreement in force between Italy and the United States. In fact, such bonds are particularly appealing for investors and allow the issuer to maximize the cash flow arising from the placement process.

The issued securities are centralized in Monte Titoli in the form of Global Notes, with an IT code assigned by the Bank of Italy. The same securities are subsequently placed in the United States by a U.S. bank playing the role of Issuer Agent, in the form of ADRs (American Depository Receipts).

The Issuer Agent ensures the daily reconciliation of the Notes registered and blocked in Monte Titoli with the ADRs issued in the centralised system of the American Central Depository (DTCC) and shall process interest payments in accordance with the redemption plan.

Monte Titoli operates as a Tax Agent, on behalf of the issuer, with the support of a certified and trusted American tax partner, to perform the following activities:

  • Collect, check and store the self-certification forms sent by the American investors;
  • Send monthly files containing details of tax exempt investors to the Italian tax agency (SOGEI) electronically;
  • Pay, on a monthly basis, taxes due from the non exempt investors (compensated with tax credits if applicable);
  • Hold the account, with records of monthly payments and tax credits, as required by law.

To ensure segregation of securities to be issued in the American market, another issuer account is opened in the name of the issuer itself, to be operated by the Issuer Agent.