Euroclear Nederland Exits Paper Certificates

Bonds, equities and depository receipts are now entirely digital, completing a process begun in the Nineties. Subsequent changes in Dutch law allowed for global certificates to be issued in place of individual stock certificates, and from December 31 2012, all securities in custody at the CSD have either been converted to the single global note or electronic book entries. During the early Nineties, at the height of issuance, Euroclear Nederland's Amsterdam vaults held over eight million paper certificates that represented around EUR 800 billion.

"Today, we have consigned the last listed paper certificate in the Dutch giro system to history," says Valerie Urbain, CEO at Euroclear Nederland. "The Netherlands has always had a strong affinity with stock certificates. We can trace the world's oldest share certificate to that of the Verenigde Oost-Indische Compagnie's issue of 1606, the first public share offering anywhere. Putting nostalgia aside, Euroclear Nederland, together with our regulators, local banks and other parts of the Dutch capital market infrastructure, is ready to usher in a modern, electronic form of securities ownership."

Dematerialization has been talked about among most CSDs and similar institutions for years, but the problem with paper certificates was starkly highlighted during Hurricane Sandy in New York last year. As a consequence of the storm, the Depository Trust and Clearing Corporation (DTCC) headquarters on Water Street, in downtown Manhattan, reported that its paper certificate holdings were gravely damaged from flooding.