Contenido

Primary Dealers

•  Primary Dealers in the Bonos and Obligaciones market
•  Qualifying conditions for the status of Primary Dealer in Bonos and Obligaciones
•  Applying to be a Primary Dealer in Bonos and Obligaciones del Estado
•  Primary Dealer rights
•  Primary Dealer obligations

• 1. Participation in Government Bond auctions: Each Market Maker must present at each auction requests for a minimal nominal value of 3 per cent of the amount sold by the Treasury for each type of instrument at prices not less than the marginal cost of sale, less 5 cents for three year Government Bonds; 10 cents for five year Government Bonds; 15 cents for ten year Government Bonds, and 30 cents for Government Bonds of more than ten years.
  
  Excluded from the calculation of the fulfilment of this obligation will be those auctions in which any of the two following conditions are present:

  - When the yield corresponding to the marginal price of the auction is set 2 or more basis points below the yield corresponding to the offer price in the existing secondary market five minutes before the auction is held.

  - When forty per cent of the volume issued is concentrated on one sole company.

  2. To guarantee the liquidity of the secondary market in Government Bonds and stripped securities in compliance with the obligations specified in the following sentences. The listing obligations of Government Bonds will be fulfilled when the listings, using the maximum differentials and the minimum volumes established by the General Directorate of the Treasury and Financial Policy, are maintained on each one of the working days according to the calendar approved by the General Directorate of the Treasury and Financial Policy, on the screens of the regulated markets or multilateral trading systems determined by this General Directorate, during the periods of time resulting from applying the following percentages to the following time bands:

• Period	Porcentaje of time to list
  8:30 to 14:00 14:30 to 17:15	70   45

  The listing obligations of the stripped principals will be fulfilled when the listings, using the maximum differentials and minimum volumes agreed by the General Directorate of the Treasury, are maintained across each one of the working days according to the calendar approved by the General Directorate of the Treasury and Financial Policy, on the screens of the regulated markets or multilateral electronic trading systems determined by this General Directorate, during a period of four hours between 9:00 and 17:15.
  The General Directorate of the Treasury and Financial Policy may modify the conditions of listing that are set out as well as those that appear in the paragraphs below, following consultation with the Market Makers.

  a) Each Market Maker must obligatorily list the benchmarks that are defined as the market benchmark which have been agreed by the General Directorate of the Treasury, following consultation with the Market Makers. In the listing of these benchmarks the maximum differentials of demand and offer prices and the minimum listed volumes agreed by the General Directorate of the Treasury and Financial Policy, following consultation with the Market Makers, must be respected.

  b) Each Market Maker must obligatorily list stripped principals in accordance with the conditions of maximum differentials and the minimum volumes agreed by the General Directorate of the Treasury and Financial Policy, following consultation with the Market Makers.

  For the listing of the stripped principals, the Market Makers may be divided into groups. In this way, the General Directorate of the Treasury may design baskets following consultation with the Market Makers in which may be included the stripped principals whose quoting will be obligatory. Each basket will be assigned to a group of Market Makers. For the preparation of the baskets the maturity of the references that constitute them will be taken into account, in such a way that they are similar in duration and liquidity. The baskets will be modified periodically.

  3. To provide the information that the General Directorate of the Treasury and Financial Policy may request about the Debt market in general and in particular the activity of the Market Maker itself.

  4. To insure through their actions the smooth functioning of the market, respecting the operating obligations that are established and avoiding carrying out actions that could negatively affect the market or the Government Debt.

•  Criteria for evaluating Primary Dealer activity
•  Removal of Primary Dealer status
•  Primary Dealers list