Clearstream and Iberclear Grant International Access to T2S

Clearstream and Iberclear will provide access to Europe’s incoming settlement platform, Target2-Securities, to central securities depositories (CSDs) in Australia, Brazil and South Africa, in a move that will allow seamless mobilization of cross-border collateral.

Europe’s CSDs Clearstream (Germany) and Iberclear (Spain) will act as a gateway for the new platform for the ‘Liquidity Alliance’, a global association of market infrastructures which also includes ASX (Australia), Cetip (Brazil) and Strate (South Africa),

“In this way, we will be able to maximize the full potential of T2S, enhancing its capabilities and extending its reach at a time when the efficient access and use of collateral has become a priority,” says Jesus Benito, CEO, Iberclear.

Clearstream is set to connect to T2S in wave three in September 2016, while Iberclear will connect in wave four in February 2017.

While T2S is largely being constructed as a purely European project, the ‘Liquidity Alliance’ will allow global access to a harmonized collateral pool in order to boost liquidity within and beyond Europe. The association is planning to extend its offerings to allow domestic collateral to cover international exposures and vice versa, in a bit to overcome collateral fragmentation.

“While we had already been following the project with interest from a distance, we did not think we could benefit directly,” says Monica Singer, CEO, Strate.

“We recognized its immense advantages early on and were one of the first infrastructures to join and to develop a clear T2S pricing strategy. It is only natural for us to not just bring the best of T2S to our customers but also to our global partners in the Liquidity Alliance,” adds Stephen Lepp, head of global securities financing, Clearstream.