Banks, which are authorised in accordance with Borsa İstanbul regulations, and the Central Bank of the Republic of Turkey (CBRT) may trade on Currency Swap Market.
In the market, swap transactions are carried out aiming the exchange of Turkish Lira and US Dollar, Turkish Lira and Euro currencies with each other in the determined conditions. Orders are placed only on house accounts, and on client accounts deemed appropriate by the General Directorate of Borsa İstanbul.
Takasbank provides central counterparty (CCP) service for the Market and guarantees the settlement termination by acting as buyer to the seller and seller to the buyer for any transaction executed.
In the market, orders are matched using the multiple price method. Two types of orders may be placed: limit orders and market orders.
Limit orders, are placed by specifying the currency amount, swap point and currency rate.
Market orders, are placed by specifying the currency amount but without specifying the currency rate and swap point. A market order may match either partially or fully with the standing orders in the system. The unexecuted portion of the market order shall be canceled automatically.
The above order types can be placed including specific conditions defined below:
a) Immediate or Cancel Order: It is the condition that as soon as the order is entered, it matches with the outstanding counter-orders, and its non-executed part is automatically cancelled.
b) Fill or Kill: This order type is subject to the condition of execution in full. If this condition is not met as the order is placed, the order is cancelled.
Swap orders are placed by specifying start value date, end value date, currency amount, swap point and currency rate.
In currency sale swap orders in exchange for Turkish Lira, the highest swap point and the lowest currency rate; in currency purchase swap orders in exchange for Turkish Lira, the lowest swap point and the highest currency rate are prioritized, respectively. For orders with same swap point and currency rate, time priority is applied.
Currency sale swap orders in exchange for Turkish Lira match with currency purchase swap orders in exchange for Turkish Lira with same or lower swap point and same or higher currency rate. Currency purchase swap orders in exchange for Turkish Lira match with currency sale swap orders in exchange for Turkish Lira with same or higher swap point and same or lower currency rate. In such trades, the swap point and currency rate of the order entered in the system earlier are the swap point and the currency rate of the trade.
Orders are valid for the day on which they are placed. Unmatched orders and the unexecuted part of matched orders transmitted to the Market can be canceled. All the same day value-dated orders are canceled unless executed at the time the same day value-dated order entry ends. Future value-dated orders are canceled by the system automatically unless executed when the Market is closed.
If swap point and/or currency rate of an order is changed or if currency amount of the order is increased, the order loses its priority. Priority is not lost if the reference information is changed and/or currency amount of the order is decreased.
The swap point tick applicable to orders conveyed to the market is 0,01%, and the currency rate tick is 0,0001.
The exchange rate of the order conveyed to the market must be within ± 15% of the arithmetic average of forex buying and selling rates announced by the CBRT. These limits and/or the exchange rate based on the application of these limits can be changed during the day by the decision of the CEO.
Orders are transmitted in 1 million USD or EUR and its multiples. The maximum order size to be transmitted at once is 300 million USD or EUR.
Same day value-dated orders are sent weekdays at 09:30-12:00, forward day value-dated orders are sent weekdays at 09:30-17:30.
Order with same day or T+1 start date can be transmitted to the market. The maximum number of days between the start value and end value dates can be 365 days. If the start and/or end value date of the order or the relevant currency falls on a holiday, the start and/or end value date of the trade is the next business day.
Settlement and Default
Takasbank shall determine the principles and procedures regarding the fulfillment of clearing obligations of trades executed in the market and the defaults arising from the failure to fulfill the clearing obligations partially or completely within the scope of time and procedures laid out in the legislation.
The exchange fee in the Swap Market is calculated as “TL amount on the start date of the swap trade x 0.005 per ten thousand (0.0000005) x Number of calender days between the start and end value dates of the swap trade”.