The Central Bank of the United Arab Emirates (UAE) has signed an agreement with the Abu Dhabi Securities Exchange (ADX) to enhance the settlement of cash payments in UAE dirhams for financial transactions listed on the exchange.

This agreement also addresses margin calls and collateral transactions through the Central Bank's network.

Under the terms of the agreement, cash settlement operations for transactions, including equities, bonds, and exchange-traded funds, will be conducted via the Central Bank’s network.

This move is in full compliance with the International Organization of Securities Commissions (IOSCO) standards regarding central clearing services and central securities depositories.

The agreement is expected to mitigate settlement risks by leveraging the Central Bank's network, thus improving the security and efficiency of trading on the ADX.

This development aligns with the exchange's strategy to modernize its infrastructure and provide reliable and secure financial services, aimed at ensuring a seamless trading experience for all market participants.

Additionally, margin settlement operations and associated collateral will also be managed through the Central Bank's platform, providing an effective and direct mechanism to accelerate settlement processes and ensure timely fulfillment of financial obligations.