Euroclear Bank, the Brussels-based international central securities depository, is to join the European Central Bank’s (ECB’s) TARGET2-Securities (T2S) settlement system, following an agreement signed with the ECB and the eurosystem central banks on 21 December.
TARGET2-Securities offers centralised settlement in central bank money across European securities markets.
By connecting to the T2S platform, Euroclear Bank clients will have the choice between euro settlement in commercial bank money and/or euro settlement in central bank money.
This, Euroclear says, will allow them to further optimise the management of their liquidity and reduce their financing costs.
By adding central bank money settlement in euro to its service offering, Euroclear Bank will provide clients with access to one single pool of liquidity and collateral across multiple currencies and jurisdictions.
Clients will also continue to benefit from the existing asset protection and service levels in collateral management and asset servicing.
Euroclear Bank’s connection to T2S supports the further integration of European capital markets into a genuine single market, Euroclear adds.
Ulrich Bindseil, director general, market infrastructure and payments, European Central Bank comments: “I welcome Euroclear Bank’s decision to join the T2S platform and our journey towards European financial integration and a single capital market. By settling securities in central bank money via T2S, Euroclear Bank can offer its clients access to the single liquidity pool of the Eurosystem’s TARGET Services for collateral, payments and securities settlement.”
Lieve Mostrey, CEO of Euroclear Group says: “We are very pleased to have achieved this significant milestone with the ECB as we work together to establish a more holistic, efficient and robust European settlement landscape, aligning to the EU Capital Market Union’s objectives. Today’s signed agreement signifies an important step in providing further support to the EU's ambitions of strengthening the Euro’s international role.”
