Clearstream declares T2S readiness for February migration

Clearstream has declared its readiness for the upcoming wave of the TARGET2 Securities (T2S) initiative in February, as it aims to avoid the issues seen with last year’s migration.

Representing the largest T2S participant, Clearstream is set to migrate on 6 February along with CSDs from Slovakia, Slovenia and Luxembourg.

Wave four will see 40% of overall volumes migrate onto the ECB’s platform, but despite the size of the task, Clearstream has taken lessons from the previous rollouts.

“Our strong and trusting collaboration with the ECB over the whole duration of this project, and in particular within the past few weeks, makes us confident regarding our own migration in February,” said Marc Robert-Nicoud, CEO at Clearstream International

“We look forward to crossing the finish line of this mammoth project, which represents a fundamental reshaping of European capital markets. T2S brings us one step closer towards a Capital Markets Union.”

In October 2015, Euroclear announced a delay in migrating its CSDs in Belgium, France and the Netherlands citing the need for more time to ensure a ‘safe and stable migration’.

Global Custodian reported in November 2016 that one industry expert warned that the project could not afford any more delays.

Initially proposed in 2006 by the ECB, the T2S initiative was designed to create a harmonised European settlement platform with settlement costs proposed at a maximum of 15 cents per settlement.

In addition a harmonised structure was proposed to give migrated CSDs a chance to increase their competitiveness across the continent as a result of moving away from the borders and monopoly structure they were used to working with.

Other industry participants have suggested that liquidity and collateral management benefits would come into effect in wave four and Robert-Nicoud concurs with this.

“We support market participants to leverage the advantages of one harmonised settlement landscape.

“Market participants have the opportunity to improve their collateral and liquidity management by adapting their access models accordingly,” said Robert-Nicoud.