T2S implementation could have been quicker says BNP

The implementation of Target 2 Securities (T2S) could have been achieved in a shorter timeframe according to the head of UK sales and relationship management at BNP Paribas.

Speaking to Global Custodian, Julien Kasparian suggested issues of time and individual countries’ priorities affected the speed of implementation.

“Once T2S was initially proposed in 2006, there was no doubt it was a great initiative for Europe but you can always question whether we could improve the time it took to get every country aligned to see the benefits,” said Kasparian.

“Every country had their own personal priorities, in Spain for example, when they were going through the Spanish market reform, T2S would not be their first priority.

“That is the situation in Europe, it will always take time as everyone has priorities.”

Initially proposed by the ECB in 2006 T2S was designed to create a harmonised European settlement platform.

Other projected benefits were also set to include reduced settlement and infrastructure costs.

The platform has been hit by numerous delays most notably Euroclear’s decision to delay entry to the initiative at the end of 2015 stating it needed more time.

Kasparian also suggested the introduction of T+2 settlement showed how market infrastructure changes can be implemented in a shorter timeframe.

“When looking at T+2 settlement, how many markets managed to get together within six months? Initially everyone was scared due to the regulatory changes and then suddenly people realise that they have to adapt.

“The timing to change from a T+3 structure was initially scary but took place really quickly. If all the participants within the market come together and agree on something it can happen quickly.”