Third-party depository of customers' transaction settlement funds, referred to as "three-party depository" for short, means that securities companies separate investors' transaction settlement funds (commonly known as deposits) from their own funds and hand them over to commercial banks for management in the name of each customer. As an independent third party, commercial banks set up detailed accounts for clients' transaction settlement funds of securities companies, realize the directional transfer of clients' transaction settlement funds through bank-securities transfer, supervise clients' transaction settlement funds, check the total amount of clients' transaction settlement funds with the detailed accounts, and monitor the safety of clients' transaction settlement funds.

Characteristic advantage

1. Client funds are closed. In this mode, the securities company will hand over the customer's fund access function to the depository bank, and the securities company will no longer handle any form of customer fund access business. All deposit and withdrawal behaviors are initiated by the customer through bank-securities transfer, and the transaction settlement funds withdrawn by the customer can only be returned to the bank settlement account with the same name specified in advance, so as to realize the closed operation of the transaction settlement funds and prevent the risk of misappropriation of customers' funds and withdrawal of customers' money laundering.

2. Check the total score of the depository bank. In this mode, the depository bank opens a management account for customers that maps the balance of the subsidiary ledger of their securities companies, so as to master the subsidiary ledger of customers and check it with the general ledger of securities companies, thus preventing the misappropriation of securities companies at the general ledger level to some extent.

3. The customer inquires about the reconciliation mechanism in another way. In this mode, the depository bank will provide customers with another way to inquire about the management account. With the help of inquiry means and reconciliation mechanism provided by depository banks and securities companies, customers can effectively monitor the safety of customers' funds by comparing the data consistency of their management accounts with those of securities companies.

4. All-round customer fund supervision system. Under this model, through reasonable business division and institutional arrangements, securities companies, depository banks, customers and regulatory agencies have built an all-round customer fund supervision system to ensure the safety of customer funds. Among them, the depository bank does not directly owe debts to customers, nor does it directly control the legal person delivery and other business operations of securities companies. Only responsible for checking the total score, to provide customers with another way of inquiry, to a certain extent, to assist in supervision.

5. Multi-bank depository mechanism helps to meet customers' different banking preferences, has strong compatibility, can better adapt to the existing domestic securities trading products and clearing and settlement rules, and can adapt to product innovation and institutional progress in the future securities market.