History of CDS
The Canadian Depository for Securities Limited (CDS Ltd.) was incorporated on June 9, 1970 in response to rising back office costs and increased volumes in the capital markets resulting from a vibrant Canadian economy. It was formed to leverage new technologies and automation to create a centralized depository service and an electronic clearing and settlement system that could not only handle higher volumes, but meet future needs.
In 1976, CDS began clearing trades executed on the Montreal Exchange and by the following year, the Toronto Exchange was on board.
In 1979, CDS became a participant of The Depository Trust Company (DTC) in New York, a first step toward meeting the growing need for access to the U.S. market. DTC became a direct CDS participant in 1998, making cross-border clearing and settlement a reality.
In 1981, the first equity securities were deposited in the book-based system. Government of Canada bonds were added to the system in the late 1980s, followed by the implementation of the Debt Clearing System for bonds and money market instruments in the early 1990s.
With the launch of CDSX® in 2003 – one of the most advanced clearing and settlement systems in the world – securities processing at CDS became simpler, faster and more effective. The completion of the securities settlement risk model in 2004 added highly effective mechanisms for managing operational, liquidity and counterparty risk exposures to CDS's operating environment.
In 2012, CDS became part of the TMX Group, creating a unified securities infrastructure that encompasses the entire lifecycle of trading, trade execution and trade settlement.