A survey of 14 major financial institutions by post-trade service provider SIX Securities Services reveals that just over three quarters, 78%, believe they will consolidate their number of settlement service providers when TARGET2-Securities (T2S) goes live in June 2015.
On worries about T2S, half of respondents said that the cost of compliance worries them most about T2S, while 41% of respondents consider the challenge of overhauling IT systems to be their biggest worry.
One respondent said they are worried by the “lack of clarity from the market i.e. cost of unbundled asset servicing”, while another says: “My major worry is that custodians are still referencing T2S as if it is a standalone consideration for clients. This is simply not the case for clients seeking a full service model. T2S, or settlement standardization, is just one of many developments impacting the market in the 2015-2017 time frame”
On T2S solutions, 58% think that the most important feature in a T2S solution is an effective cash management capability, while 21% say that the ability to pool securities across markets is the most important feature
Robert Almanas, MD, International Services, comments: “Make no mistake – financial institutions should not approach T2S as a mere compliance project. T2S needs to be considered as part of the whole wave of regulatory changes affecting the financial markets over the coming years. For example, T2S is an opportunity for financial institutions to optimize capabilities such as collateral management and cash management which are becoming much more important under other pieces of regulation.”
Survey Reveals New Worries on T2S
A survey of 14 major financial institutions by post-trade service provider SIX Securities Services reveals that just over three quarters, 78%, believe they will consolidate their number of settlement service providers when TARGET2-Securities (T2S) goes live in June 2015.
« Hong Kong Brokers Select Markit Technology to Comply with New Electronic Trading Rules