BNY Mellon connects to Italian CSD through T2S

BNY Mellon’s direct connection to Monte Titoli through T2S aims to provide deadlines closer to market cut-offs and reduce risk.
By Paul Walsh
BNY Mellon has migrated clients’ assets to direct accounts with Italian central securities depositary (CSD) Monte Titoli using its connection to TARGET2-Securities (T2S).

As a directly connected participant to T2S, BNY Mellon will settle transactions in listed securities, such as equities and fixed income with Monte Titoli in a bid to reduce operational risk and extend deadlines closer to market cut-offs.

Previously BNY Mellon settled transactions in the Italian market through sub-custodian services.

BNY Mellon will also provide clients with portfolio servicing activities, including corporate actions, income processing, tax and proxy voting.

Monte Titoli is the authorised CSD for centralised administration, settlement and ancillary services in the Italian market.

“We are delighted that BNY Mellon, one of the world’s largest investment services companies, has become a participant of Monte Titoli,” said Mauro Dognini, CEO at Monte Titoli.

“In doing so, BNY Mellon and its clients will be able to fully benefit from the implementation of T2S using Monte Titoli for the provision of settlement, asset and fiscal services, which will help improve operational efficiency and reduce risk.”

Initially proposed by the ECB in 2006, T2S acts as a single securities settlement system for over twenty European markets. One of its key objectives is to standardise and harmonise securities settlement across Europe, opening up opportunities for the consolidation of custody relationships.

BNY Mellon is using its connection to T2S to go direct to other markets in the Eurozone. It is direct in Germany and the Netherlands, in addition to direct CSD connections already in existence in other markets such as the Depository Trust & Clearing Corporation (DTCC) and Fedwire in the US and CREST in the UK.

“Our connection to T2S will help us streamline back-office operations and reduce risk by offering our clients direct access to central bank money,” said Tom Casteleyn, head of product management for custody, cash and FX at BNY Mellon.

“Our direct accounts with Monte Titoli will enable us to provide clients with deadlines that are closer to market cut-offs, whilst improving our asset servicing capabilities.”