🔗 End-to-End Chain & Key Assumptions (How foreign stocks bought via T-Bank/Tinkoff get to the Hong Kong Exchange and why they are now blocked) --- 1. Investor buys foreign stock via T-Bank - Order is placed in the T-Invest app (or web) in rubles or USD. - T-Bank acts as broker-dealer. 2. Routing inside Russia ``` Investor → T-Bank → SPB Exchange → SPB Bank (Best Efforts Bank) → National Settlement Depository (NSD/NRD) ``` - SPB Bank is the primary depository for SPB Exchange. - NSD is the higher-level depository used when SPB Bank itself needs an external custodian. 3. Cross-border link ``` NSD ↔ Euroclear Bank (Belgium) ↔ Clearstream (Luxembourg) ↔ Hong Kong Central Clearing & Settlement System (CCASS) ↔ Hong Kong Exchange (HKEX) ``` - The actual shares sit at CCASS (for HK-listed names) or at DTCC (for US ADRs). - Euroclear / Clearstream keep the omnibus account on behalf of NSD. --- ⚠️ Where the chain broke (2022-2023) Date Event Effect Feb–Mar 2022 US/EU sanctions hit NSD Euroclear & Clearstream freeze all NSD accounts. 27 May 2022 Bank of Russia mandates Russian brokers to segregate any foreign securities whose accounting chain touches NSD. 30 May 2022 T-Bank moves the affected shares to non-trade (locked) sub-ledger. They appear in the app with 🔒. Jun 2023 Additional sanctions on SPB Exchange itself. Remaining non-NSD foreign shares also stop trading. --- 🔍 Detailed Depository Map (status as of 31 Aug 2025) Layer Entity Status Investor You Can only sell (if qualified) on OTC desk or via Presidential Decree 844 swap. Broker T-Bank Internal OTC marketplace reopened Dec 2024 (RUB only, 40-65 % discount). Exchange SPB Exchange Halted for most foreign names; only -RM tickers reopened Apr 2025 for qualified investors. Depository 1 SPB Bank Still functions, but cut off from Euroclear/Clearstream. Depository 2 NSD Under EU/OFAC sanctions; no bridge to Euroclear. International CSD Euroclear / Clearstream Will not process NSD-linked instructions. Final CSD CCASS (HK) / DTCC (US) Oblivious to Russian client level; they see Euroclear/Clearstream as the “holder of record”. --- 🧩 Key Assumptions & Work-arounds Assumption Evidence / Source NSD is the single point of failure T-Bank Help https://www.tbank.ru/invest/account/help/blocked-securities/ explicitly lists NSD freeze as the reason. Shares still exist in CCASS/DTCC Dividend accruals continue to reach Euroclear (but stop at NSD). No mandatory confiscation Presidential Decree 844 uses voluntary swap at ₽100 k cap; unsold shares remain investor property. Alternative friendly depositories Unconfirmed; press mentions talks with ChinaClear, Iran Central Securities Depository, but no live bridge yet. Discount persists OTC quotes show 35–82 % discount vs fair value; liquidity <1 % of normal volume. --- 📌 Visual Flow (before & after freeze) Pre-sanctions ``` You → T-Bank → SPB Bank → NSD → Euroclear → CCASS → HKEX ``` Post-sanctions (locked) ``` You → T-Bank → SPB Bank → 🔒(NSD) ❌ Euroclear → CCASS → HKEX ``` #Current OTC path (qualified only) ``` #You ↔ T-Bank internal OTC book ↔ #other Russian clients ``` #Potential future path (speculative) ``` You → #T-Bank → #SPB #bank → New CSD (e.g., ChinaClear) → CCASS → HKEX ``` --- ✅ Take-away for an investor - Your shares are not gone—they are frozen at the NSD layer. - Full unlock requires either 1. Sanctions relief (NSD delisted), or 2. Mass asset swap (state-level negotiations), or 3. Migration to a non-sanctioned depository (technical & legal hurdles). - Until then, sell at discount via OTC or wait for Decree 844 round 2.