The announcement that IBERCLEAR, the Spanish CSD, is moving on to the same settlement calendar as the TARGET payments system between European central banks, is not – on the face of it – particularly exciting news. However, it is more significant than appearances suggest. The TARGET calendar is the one followed by other European CSDs, and so its adoption by the Spanish marks a further step towards the harmonisation of securities settlement systems in western Europe.
IBERCLEAR will use the calendar – which means it will be shut on New Year’s Day, Good Friday, Easter Monday, 1 May, Christmas Day and Boxing Day only – from 1 May 2004. The move applies to trades on the Spanish Stock Exchanges and Latibex Market only, as the TARGET calendar has been implemented already for the Spanish Public Debt and the AIAF Fixed Income Markets. It means all trades in Spanish markets whose registration and settlement is controlled by IBERCLEAR will now settle on the TARGET calendar.
IBERCLEAR point out that its decision paves the way for further consolidation of clearing and settlement activities, and follows one of the recommendations of the Giovannini Report. Its second volume, published in April 2003, charged the European Central Securities Depositaries Association (ECSDA) with studying and removing differences in the operating hours of its members. The report established the TARGET calendar as the benchmark, with the objective of removing differences within two years.
IBERCLEAR is the Spanish Central Securities Depository in charge of both the register of securities, held in book-entry form, and the clearing and settlement of all trades from the Spanish Stock Exchanges, the Public Debt Market, the AIAF Fixed Income Market, and Latibex – The Latin American stock market denominated in euros. IBERCLEAR is part of Bolsas y Mercados Espaoles, Sociedad Holding de Mercados y Sistemas Financieros, S.A., the holding company that owns the Spanish Stock Exchanges, the AIAF Fixed Income Market, the Derivatives Market and the Spanish clearing and settlement systems.