The Over-the-Counter (OTC) Comparison service accepts one-sided transactions from NSCC participants and matches buyers and sellers based upon clearing firm, executing market participant ID, CUSIP or trading symbol, share quantity, price and trade date.

Overview

The Over-the-Counter (OTC) Comparison service accepts one-sided transactions from NSCC participants and matches buyers and sellers based upon clearing firm, executing market participant ID, CUSIP or trading symbol, share quantity, price and trade date. Once a match is established, the trade is recorded and a contract is forwarded to the participants confirming the comparison. Eligible securities are forwarded to NSCC's Continuous Net Settlement (CNS) system where they are novated. Trades ineligible for CNS either settle trade-for-trade or are included in NSCC's multi-lateral net balance order process.

Transactions that do not result in a match during the NSCC comparison process are reported as such to participants on the night the trade was submitted. Participants can continue to try and establish a match by resubmitting the trade to the NSCC comparison process the following day.

Who Can Use the Service

The service is available to all NSCC members.

Benefits

The service provides a number of operational advantages:

• Transactions can be matched at three different levels.
• Settlement is centralized in NSCC's CNS application (for CNS-eligible securities).
• Participants can resubmit unmatched transactions until a match is confirmed.
• Participants receive an advisory when another participant names them as the counter-party to an unmatched trade.
• Participants receive feedback on both matched and unmatched transactions.

How the Service Works

The OTC comparison application accepts one-sided trade data at the end of each business day. The service matches submissions based on a number of criteria, as follows:

• M1 - All terms on the contract agree (exact match)
• M2 - All terms agree, except trade quantity (summarized match)
• M3 - All terms agree ,except quantity and executing broker (summarized two-way match)

Results of the match are reported to participants on NSCC's 400-byte MRO intra-day output as well as on end-of-day print image files. The intra-day output was created in a universal format so that all trade data is reported to participants using virtually the same record layout.

For More Information

Please call Relationship Management at 800-422-0582.