Settlement transaction types
CONV: DR Conversion
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CONV marks a settlement movement that is part of a depositary receipt conversion, where holdings move between depositary receipts and the underlying local shares.
- Code
- CONV
What CONV means
Depositary receipts such as ADRs and GDRs represent shares held by a custodian in the home market. Holders or brokers convert between the receipts and the local shares to trade where liquidity or price is better. The settlement movements that carry out such a conversion are flagged CONV; LuxCSD’s 2014 Singapore notice maps it to ADR conversion.
The creation of new receipts is ISSU, and the cancellation of receipts with release of the local shares is RELE. A plain purchase or sale of the receipts is TRAD.
When you see it
- On free deliveries and receipts between a broker’s account and the depositary bank’s or its local custodian’s account during a DR conversion.
What to do next
- Use CONV for the movements of a conversion and follow the depositary bank’s instructions on fees and timing. Make sure both the receipt leg and the local share leg are instructed; one-sided conversions leave positions stuck at the depositary.
Where it appears in MT and ISO 20022
MT (ISO 15022)
- MT540, MT541, MT542 and MT543: sequence E (SETDET), field 22F,
:22F::SETR//CONV. The SETR qualifier is mandatory, so every instruction carries one code (format:4!c/[8c]/4!c; with a data source scheme a proprietary code may be sent instead). - Repeated in the confirmations MT544, MT545, MT546 and MT547 (sequence E,
:22F::SETR//CONV) and in the MT548 status advice (sequence B, where SETR is mandatory when the sequence is present). - Optional in the statements: MT536 subsequence B1a2 and MT537 subsequences B2b and C2.