Please explain the meaning of securities custody and securities depository.

Securities custody: Generally speaking, securities custody refers to the behavior that investors entrust their securities to a securities company for safekeeping, and the securities company handles the affairs related to securities rights and interests on their behalf. Securities Depository: Securities Depository is a form of property custody system, which means that securities registration and settlement institutions and their dispatched offices, as statutory registration institutions, accept the entrustment of investors and provide them with various services such as transaction transfer, non-transaction transfer and other equity registration changes, dividend distribution, stock account inquiry and loss reporting, so as to finally determine shareholders' rights and interests and changes in equity.

Securities custody refers to a system in which clearing companies and their agencies, as legal securities registration institutions, accept the entrustment of investors and provide them with various services such as transaction transfer of registered securities, non-transaction transfer of registered securities and other securities registration changes, stock dividends and loss reporting of securities accounts, so as to finally determine the rights and interests of securities holders and securities changes. Securities depository is a form of property custody system.

The principle of securities custody is to centrally deposit registered securities such as stocks, funds and paperless government bonds, and record the quantity and changes of the deposited securities in the form of computer bookkeeping according to the securities account opened by each investor. After depository, the securities shall be illiquid. For the transfer of securities caused by changes in equity and creditor's rights, physical securities are not issued, but are transferred through books.

Securities depository refers to the behavior that a securities company submits the securities entrusted by investors and its own securities to the securities registration and settlement institution for safekeeping, and the securities registration and settlement institution handles the securities rights and interests affairs on its behalf. The securities depository business specifically includes: maintaining the balance of self-owned securities and customers' securities deposited by securities companies, providing services such as inquiring and collecting dividends, and recording the emergence, change and termination of the custody relationship between securities companies and customers.

Securities depository principle

1. Implement the principle of centralized depository for registered securities such as stocks, funds and paperless government bonds;

2. According to the securities accounts opened by each shareholder, record the quantity and changes of the securities deposited in the form of computer bookkeeping;

3. After the securities are deposited, the illiquidity system shall be implemented. The transfer of securities caused by the change of equity and creditor's rights shall not issue physical securities, but shall be transferred by book.