History
ISINs were first used in 1981, but did not reach wide acceptance until 1989, when the G30 countries recommended adoption. The ISIN was endorsed a year later by ISO with the ISO 6166 standard. Initially information was distributed via CD-ROMs and this was later replaced by distribution over the internet. In 2004 the European Union mandated the use of instrument identifiers in some of its regulatory reporting, which included ISIN as one of the valid identifiers.Description
'' ISO 6166'' (or ISO6166:2013 as of the 2013 revision) defines the structure of an International Securities Identification Number (ISIN). An ISIN uniquely identifies a fungible security. Securities with which ISINs can be used are: * Equities (shares, units, depository receipts) * Debt instruments ( bonds and debt instruments other than international, international bonds and debt instruments, stripped coupons and principal, treasury bills, others) *Entitlements (Usage and acceptance
Since 1989, when ISINs were introduced, they have slowly gained traction worldwide in their usage. ISINs are being introduced worldwide and are the most popular global securities identifier. Trading, clearing and settlement systems in many countries have adopted ISINs as a secondary measure of identifying securities. Some countries, mainly in Europe, have moved to using the ISIN as their primary means of identifying securities. In addition new European regulations such asCommercial model
The ISIN is generally included in services sold by financial data vendors and intermediaries. These services are normally paid services as more value added data is included with the information. In general, the issuer of a security will include the ISIN in issuance papers or other documentation for identification purposes.Controversy
In 2009, Standard & Poor's was charged by theExamples
The examples below describes one approach for applying the Luhn algorithm on two different ISINs. The difference in the two examples has to do with if there are an odd or even number of digits after converting letters to number. Since the NSIN element can be any alpha numeric sequence (9 characters), an odd number of letters will result in an even number of digits and an even number of letters will result in an odd number of digits. For an odd number of digits, the approach in the first example is used. For an even number of digits, the approach in the second example is used. The Luhn algorithm can also be applied in the same manner for both types or lengths (alternating multiply the string of digits by 1 and 2, starting from the end of the string), being more generic.Apple, Inc.
Apple, Inc.: ISIN US0378331005, expanded from CUSIP 037833100 The main body of the ISIN is the original CUSIP, assigned in the 1970s. The country code "US" has been added on the front, and an additional check digit at the end. The country code indicates the country of issue. The check digit is calculated using the Luhn algorithm. Convert any letters to numbers by taking the ASCII code of the capital letter and subtracting 55: U = 30, S = 28. US037833100 -> 30 28 037833100 Collect odd and even characters: 3028037833100 = (3, 2, 0, 7, 3, 1, 0), (0, 8, 3, 8, 3, 0) Multiply the group containing the rightmost character (which is the FIRST group) by 2: (6, 4, 0, 14, 6, 2, 0) Add up the individual digits: (6 + 4 + 0 + (1 + 4) + 6 + 2 + 0) + (0 + 8 + 3 + 8 + 3 + 0) = 45 Take the 10s modulus of the sum: 45 mod 10 = 5 Subtract from 10: 10 − 5 = 5 Take the 10s modulus of the result (this final step is important in the instance where the modulus of the sum is 0, as the resulting check digit would be 10). 5 mod 10 = 5 So the ISIN check digit is five.Treasury Corporation of Victoria
TREASURY CORP VICTORIA 5 3/4% 2005-2016: ISIN AU0000XVGZA3. The check digit is calculated using the Luhn algorithm. Convert any letters to numbers by taking the ASCII code of the capital letter and subtracting 55: A = 10, G = 16, U = 30, V = 31, X = 33, Z = 35. AU0000XVGZA -> 10 30 0000 33 31 16 35 10. Collect odd and even characters: 103000003331163510 = (1, 3, 0, 0, 3, 3, 1, 3, 1), (0, 0, 0, 0, 3, 1, 6, 5, 0) Multiply the group containing the rightmost character (which is the SECOND group) by 2: (0, 0, 0, 0, 6, 2, 12, 10, 0) Add up the individual digits: (1 + 3 + 0 + 0 + 3 + 3 + 1 + 3 + 1) + (0 + 0 + 0 + 0 + 6 + 2 + (1 + 2) + (1 + 0) + 0) = 27 Take the 10s modulus of the sum: 27 mod 10 = 7 Subtract from 10: 10 − 7 = 3 Take the 10s modulus of the result (this final step is important in the instance where the modulus of the sum is 0, as the resulting check digit would be 10). 3 mod 10 = 3 So the ISIN check digit is three.BAE Systems
BAE Systems: ISIN GB0002634946, expanded from SEDOL 000263494 The main body is the SEDOL, padded on the front with the addition of two zeros. The country code "GB" is then added on the front, and the check digit on the end as in the example above.Check-digit flaw in ISIN
The Treasury Corporation of Victoria ISIN illustrates a flaw in ISIN's check digit algorithm which allows transposed letters: Suppose the ISIN was mis-typed as AU0000VXGZA3 (instead of AU0000XVGZA3) A = 10, G = 16, U = 30, V = 31, X = 33, Z = 35. "AU0000VXGZA" -> 10 30 00 00 31 33 16 35 10". Collect odd and even characters: 103000003133163510 = (1, 3, 0, 0, 3, 3, 1, 3, 1), (0, 0, 0, 0, 1, 3, 6, 5, 0) Multiply the group containing the rightmost character (which is the SECOND group) by 2: (0, 0, 0, 0, 2, 6, 12, 10, 0) Add up the individual digits: (1 + 3 + 0 + 0 + 3 + 3 + 1 + 3 + 1) + (0 + 0 + 0 + 0 + 2 + 6 + (1 + 2) + (1 + 0) + 0) = 27 Take the 10s modulus of the sum: 27 mod 10 = 7 Subtract from 10: 10 − 7 = 3 Take the 10s modulus of the result (this final step is important in the instance where the modulus of the sum is 0, as the resulting check digit would be 10). 3 mod 10 = 3 So the ISIN check digit is ''still'' three even though two letters have been transposed. Such flaw against a single transposed pair of letters or digits would have been avoided using two check digits instead of just one (i.e., a 97 modulus instead of the 10 modulus, like inSee also
*References
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