Spotlight

Dear colleagues,

2012 is coming to a close and we can look back on another very exciting year for T2S!

The key event in 2012 was the signing of the Framework Agreement, and I would not hesitate to say that, with those signatures, the T2S project has passed the most significant "litmus test" since its inception: 23 CSDs have joined the T2S Community, and have thus taken a significant step towards our common goal of "making Europe a better place to invest".

The Eurosystem has selected two network service providers (SIA/COLT and SWIFT). Major decisions on the timing and composition of the migration waves have been taken and will be fine-tuned in the coming days. These are perhaps the most visible features of 2012, which confirm that the project is on track.

Looking ahead, 2013 might be a year of consolidation for T2S. The 4CB will finalise the development and internal testing of the T2S platform, and on this basis, participating markets and CSDs will start reshaping in line with their adaptation plans.

I would like to thank all of you in the T2S Community for your continued commitment to our common project, and for your hard work to make T2S a success. I wish you, your families and your colleagues a Merry Christmas and a Happy New Year!

Jean-Michel Godeffroy, Chairman of the T2S Board

We are happy to announce that the autumn 2012 edition (T2S OnLine Quarterly Review ") is now available for you.

In the editorial, Jean-Michel Godeffroy, Chairman of the T2S Board, shares some of his thoughts on the first achievements and challenges encountered by the T2S Community under its new governance structure. He particularly focuses on the composition of the migration waves and how the change requests raised by CSDs as a result of their feasibility assessments are being handled.

In "Bayle’s View", Marc Bayle describes the approach that was taken to finalise the migration plan, which needed to respect the provisions stipulated in the Framework Agreement, accommodate the wishes of the T2S markets and, at the same time, ensure a safe and smooth migration to the new platform in 2015-2016.

We are also introducing the new T2S Board, giving you an insight into its structure and responsibilities and a little background on each of the 13 members.

In the Insight section you can read about the highlights from Sibos, which took place at the end of October in Osaka, and about the work done by the Task Force on adaptation to cross-CSD settlement (TFAX).

As always, you can find out about the progress that T2S has made since the summer edition of T2S OnLine in the T2S Project update.

We hope you will enjoy reading this edition of T2S OnLine!

On Thursday an open theatre session entitled "T2S: project update and opportunities for non-European markets" took place. In addition to the project update, the presentation given by Helmut Wacket from the T2S Programme focused on how non-European markets will be able to reap the benefits of T2S. This session in particular drew the attention of non-European stakeholders, who raised questions about whether Asian CSDs would be able access T2S, and how they would do so.

This session brought the 2012 Sibos convention to a close, and we would like to thank you for visiting the Eurosystem stand. We hope you enjoyed the T2S events and that you had an interesting few days in Osaka.

Two Eurosystem events took place this Wednesday at Sibos. A community session entitled "What will the European financial market infrastructure look like in 2020?" discussed the financial market infrastructure in general, and members of the panel emphasised the importance of T2S as a key component in the post-trade environment.

Benoît Cœuré, Member of the Executive Board of the ECB, held a one hour session entitled "In conversation with Benoît Cœuré". He stressed that it had become obvious during Sibos that the mindset vis-à-vis T2S has changed, and that discussion is now focused on how to prepare for T2S. He emphasised that the Eurosystem and the CSDs that have signed the T2S contract are strongly committed to delivering T2S.

On 1 November, an open theatre session entitled "T2S: project update and opportunities for non-European markets" will take place from 10.45 a.m. to 11.15 a.m.

The 30 October T2S community session, entitled "Adapting to T2S: what are the challenges?" was a constructive and informative event. Benoît Cœuré, Member of the Executive Board of the ECB, opened the session by stating that T2S will be a key component of the European Market Infrastructure, and that the Governing Council of the ECB remains committed to delivering it. In the panel discussion his statements were echoed by CSDs and market participants. Jesús Benito (Iberclear) stressed that T2S must be a success story, and that he felt sure that everyone had understood that message. Also speaking for a CSD, Mark Gem (Clearstream) assured that Clearstream has always been supportive of T2S, and that T2S is important as it will facilitate collateral management. Market participants stressed the need for clarity on the migration plan, and requested more concrete details about what CSDs intend to offer them as clients. In particular, Diana Dijmarescu (JP Morgan) said that market participants require a better understanding of the offer tabled by CSDs, and Alain Pochet (BNP Paribas) underlined that it is in everyone's best interests that migration to T2S occurs in a safe manner. Paul Bodart, Member of the T2S Board and moderator of the panel, asked for views on the effects of T2S on competition. The panel agreed that T2S will foster competition, and Jesús Benito emphasised that settlement prices in the T2S environment will indeed be driven by competition.

Almost 150 participants attended the session.

Sibos 2012 is underway. If you are in Osaka come visit us at the Eurosystem stand and do not miss tomorrow's panel discussion on T2S.

Tuesday, 30 October 2012
3.30 p.m. - 4.30 p.m.: Panel session in Community room 3
"Adapting to T2S: what are the challenges?"
Opening remarks by Benoît Cœuré, member of the Executive Board of the European Central Bank.
Moderator: Paul Bodart, member of the T2S Board
Panellists:
 Jesús Benito, CEO, Iberclear
Diana Dijmarescu, Managing Director, JP Morgan
 Mark Gem, Member of the Executive Board, Clearstream Banking Luxembourg
Alain Pochet, Head of Clearing, Custody & Corporate Trust Services, BNP Paribas

After the T2S session you are also warmly invited to a reception at the Eurosystem stand (hall 4, stand 4E09) at 4.30 p.m. hosted by Mr Benoît Cœuré. Our stand is located just outside the Community Session rooms.

Keep up-to-date right here on the T2S webpages.

We are pleased to invite you to the Eurosystem and T2S events at this year's Sibos, which will take place in Osaka from 29 October to 1 November 2012. The main T2S-related events are:

Tuesday, 30 October 2012
3.30 p.m. - 4.30 p.m.: Panel session in Community room 3
"Adapting to T2S: what are the challenges?"
Opening remarks by Benoît Cœuré, member of the Executive Board of the European Central Bank.
Moderator: Paul Bodart, member of the T2S Board
Panellists:
 Jesús Benito, CEO, Iberclear
Diana Dijmarescu, Managing Director, JP Morgan
 Mark Gem, Member of the Executive Board, Clearstream Banking Luxembourg
Alain Pochet, Head of Clearing, Custody & Corporate Trust Services, BNP Paribas

After the T2S session you are also warmly invited to a reception at the Eurosystem stand (hall 4, stand 4E09) at 4.30 p.m. hosted by Mr Benoît Cœuré. Our stand is located just outside the Community Session rooms.

Thursday, 1 November 2012
10.45 a.m. - 11.15 a.m.: Open theatre session in Open Theatre 1
"T2S: project update and opportunities for non-European markets"

We very much look forward to seeing you in Osaka! Keep up-to-date right here on the T2S webpages.

Following the publication in June of the first paper of the T2S Special Series entitled T2S Benefits, we are publishing today the second contribution to this series, entitled T2S Auto-collateralisation and written by Mehdi Manaa (ECB).

The auto-collateralisation function is one of the key features of T2S and is expected to lead to significant savings in terms of liquidity and securities, as well as decreased borrowing costs for banks.

This paper explains, from a business perspective, how auto-collateralisation will work in T2S and how users will benefit from it in practice. It outlines the general settings of auto-collateralisation in T2S, gives details on the provision of static data and describes how limits can be set, managed and monitored. Finally, the paper describes each phase of the auto-collateralisation process, as established in the T2S User Requirements.

We hope you will enjoy reading this second issue!

Following the establishment of the new T2S governance structure on 1 July, and the approval of the new mandate of the AG and the nomination of its user representatives by the Governing Council of the ECB, the AG held its first meeting on 18 and 19 September in Frankfurt.

The AG is the element that has remained a constant during the changes made to the T2S project governance structure. It will continue both to ensure that T2S meets the needs of the market and give a voice to all T2S stakeholders. In its new composition it has 95 members, comprising four main groups: the 23 CSDs that have signed the T2S Framework Agreement, the user representatives, the central banks and the observers.

We value the advice provided by the AG and look forward to continuing our good cooperation.

On 3 January 2012, two T2S connectivity licences were awarded to SWIFT and a consortium composed of SIA and Colt – see T2S OnLine No 11, Winter 2012. We are happy to announce that both companies have successfully completed the Proof-of-Concept phase in advance of the deadline stipulated in the licence agreement. Congratulations to all involved.

We are happy to announce that the summer 2012 edition of the T2S OnLine Quarterly Review is now available for you. For the most part, this issue is dedicated to the new T2S governance structure, in particular to the establishment of the new T2S Board and the CSD Steering Group.

In the editorial, Jean-Michel Godeffroy, Chairman of the new T2S Board, shares some of his thoughts on the enlargement of the T2S Community to include a further 14 CSDs, and on the role and responsibilities of the steering groups in the new governance structure.

In “Bayle’s View”, Marc Bayle focuses on the structure of the new T2S governance at the “working level”, providing detailed information on its different components and how they will interact with the “steering level”, and also describes the challenges ahead.

As always, you will be offered a general update on the progress made by T2S over the last two months. The update also includes information about the user members of the new T2S Advisory Group and user observers of the CSG Steering Group.

In this new edition, you will also have the chance to read the interview with Jesús Benito, CEO of Iberclear, in which he shares his views on the role of the CSG and his own role as Chairman. In the last article of this issue, you will also be introduced to the new CSD Steering Group, with an insight into its structure and responsibilities.

Finally, the Insight by Mehdi Manaa explains the benefits of one of the key functionalities of T2S, which is the auto-collateralisation service, and announces the forthcoming publication of a paper from the T2S Special Series on this topic.

We hope you will enjoy reading this edition of T2S OnLine!

The Governing Council of the ECB approved the nomination of the members of the new T2S Board, which will assume the role thus far carried out by the T2S Programme Board (see press release of 19 July 2012). Its responsibilities include developing proposals for the Governing Council on key strategic issues and executing tasks assigned to it by the Governing Council. Furthermore, the T2S Board is to ensure that the T2S Programme is delivered in accordance with market expectations, within the T2S financial regime and the time frame established by the Governing Council (T2S Board mandate)

Jean-Michel Godeffroy was reappointed Chairman, with Pierre Beck, Executive Director at Banque centrale du Luxembourg, as Deputy Chairman.

The Governing Council appointed eight further members from the Eurosystem’s central banks, namely:

• Peter Holicka, Executive Director Payment Systems, Národná banka Slovenska;
• Luc Janssens, Head of the Securities Division, Nationale Bank van België/Banque Nationale de Belgique;
• Yvon Lucas, Adviser to the General Director of Operations General Directorate, Banque de France;
• Cristina Mastropasqua, Senior Manager, Payment Systems Department, Banca d’Italia;
• Jochen Metzger, Head of the Payments and Settlement Systems Department, Deutsche Bundesbank;
• Michalis Michalopoulos, Director of the Government Financial Operations and Accounts Department, Bank of Greece;
• Michael Power, Head of IT & Deputy Chief Information Officer, Central Bank of Ireland;
• Luis Miguel Rodriguez Caramelo, Senior Advisor to the Directorate General Operations, Markets and Payment Systems, Banco de España.

The Governing Council also appointed one member from a non-euro area central bank, Kristian Kjeldsen, Head of the Payment Systems Department at Danmarks Nationalbank, and two non-central bank members, Paul Bodart, up to now Executive Vice President, CEO of The Bank of New York SA/NV, Head of EMEA Operations, and Soledad Nuñez, former Director General of the Treasury and Financial Policy, Ministry of Economy and Finance in Spain.

We congratulate the new members of the T2S Board and wish them every success for the future!

30 June 2012 was the deadline for CSDs to indicate whether or not they would sign the T2S Framework Agreement. As reported in an ECB press release, in addition to the nine CSDs that signed up for T2S in May, a further fifteen CSDs have now announced that they will join T2S, namely:

• AS Eesti Väärtpaberikeskus (Estonia);
• Central Depository AD (Bulgaria);
• Centrálny depozitár cenných papierov SR, a. s. (Slovakia);
• Cyprus Stock Exchange;
• Euroclear Belgium;
• Euroclear Finland Oy;
• Euroclear France;
• Euroclear Nederland;
• Interbolsa – Sociedade Gestora de Sistemas de Liquidação e de Sistemas Centralizados de Valores Mobiliários, S.A. (Portugal);
• KDD - Centralna klirinško depotna družba, d.d. (Slovenia);
• Központi Elszámolóház és Értéktár Zrt. – KELER (Hungary);
• Lietuvos centrinis vertybinių popierių depozitoriumas (Lithuania);
• Malta Stock Exchange;
• Oesterreichische Kontrollbank Aktiengesellschaft (Austria); and
• SIX SIS Ltd. (Switzerland).

This brings to a total of 24 the number of CSDs participating in T2S, including almost all CSDs based in the euro area as well as six CSDs based outside the euro area.

A new member of the T2S community is also Danmarks Nationalbank which signed the Currency Participation Agreement on 20 June 2012 in Copenhagen and will make the Danish krone available in T2S in 2018.

Jean-Michel Godeffroy, Chairman of the T2S Programme Board, discusses this achievement as well as the role of the T2S Community in a short Q&A.

We would like to announce the launch of the T2S Special Series, a new series of papers, each addressing in detail a specific topic related to T2S. Contributions to the T2S Special Series, are very welcome from T2S stakeholders, and can range from strategic and business matters to technical and operational issues – and this is what makes this new T2S publication "special".

Today we are publishing the first paper of the series entitled "T2S benefits: much more than fee reductions", written by Ben Weller (ECB). While the reduction of settlement fees remains a key objective of T2S, this paper concentrates in particular on other significant benefits that T2S can generate for Europe in terms of risk reduction, competition and business, collateral and liquidity savings, and operational efficiency.

We hope you will enjoy the reading of this first issue.

We are happy to announce that the spring 2012 edition of the T2S OnLine Quarterly Review is now available for you. For the most part, this issue is dedicated to the signing event of 8 May, during which a first group of nine CSDs signed the T2S Framework Agreement.

In the editorial, Jean-Michel Godeffroy, Chairman of the T2S Programme Board, shares some thoughts on this achievement and reiterates the importance of the T2S project for Europe.

As always, you will be offered a general update on the progress made by T2S over the last few months.

The Insight offers an overview of the highlights of the 8 May event in the form of a “reportage”, with a particular focus on the messages conveyed by the Eurosystem and CSD representatives in their speeches, presentations and interviews.

An outlook detailing the next key milestones of the T2S project is provided in “Bayle’s View”, in which Marc Bayle outlines what we can expect from the T2S project over the coming year.

Finally, the nine CSDs that have already signed the Framework Agreement are the subjects of the last article, entitled “Introducing the first CSDs of the T2S Community”.

We hope you will enjoy this “special” edition of T2S OnLine!

In its meeting of 15 May 2012 the ECOFIN Council reiterated its political support for the T2S project “as an important contributor for the establishment of the Single Market for securities services”.
TARGET 2 - Securities - Draft Council conclusions

The ECOFIN Council expressed its appreciation of the progress made by the Eurosystem and the relevant stakeholders, in particular the CSDs. It also highlighted the importance for T2S of the CSD Regulation, the draft of which was published by the European Commission on 7 March 2012.

The ECOFIN Council had already endorsed the T2S project back in 2007 and formulated some recommendations which T2S has subsequently followed, in particular with regard to the system’s multi-currency dimension, the project’s governance structure and the level of transparency for market participants.

On 8 May 2012, the ECB hosted an event marking the signing of the T2S Framework Agreement by the Eurosystem and a first group of nine European central securities depositories (CSDs).

The event was attended by senior representatives from the Eurosystem and from across the financial sector. Mario Draghi, the President of the ECB, and Peter Praet, the member of the ECB Executive Board responsible for T2S both spoke at the event. They highlighted the importance of the T2S project for Europe, and outlined how it is expected to evolve.

Representatives from the signing CSDs were also given the opportunity to make a key statement, along with Ignazio Visco, Governor of Banca d’Italia and other Eurosystem representatives.

The signing of the T2S Framework Agreement by the first nine CSDs is an important milestone for the T2S project. Other CSDs which needed more time to conclude their internal assessments, will decide by 30 June 2012 whether to sign the T2S Framework Agreement.

Events proceedings, video and photos

30 April 2012 was the deadline for indication by CSDs of their decision to join T2S early. We can now announce the first group of CSDs that have committed to signing the T2S Framework Agreement, consisting of the following 9 CSDs:

• Bank of Greece Securities Settlement System - BOGS (Greece)
• Clearstream Banking AG (Germany)
• Depozitarul Central (Romania)
• Iberclear (Spain)
• LuxCSD S.A. (Luxembourg)
• Monte Titoli S.p.A. (Italy)
• National Bank of Belgium-Securities Settlement System – NBB-SSS (Belgium)
• VP LUX S.à.r.l. (Luxembourg)
• VP Securities A/S (Denmark)

We are also pleased to announce the event that will mark the signing of this important contract by CSDs and the Eurosystem. The event will take place on 8 May 2012 in Frankfurt, and will be attended by Mario Draghi, ECB President, and Peter Praet, the member of the ECB Executive Board responsible for T2S.

The signing of the T2S Framework Agreement by the first 9 CSDs represents a key milestone for the T2S project. CSDs that need more time to conclude their internal assessments may sign the T2S Framework Agreement by 30 June 2012.

The T2S Board is the governance body set to succeed the T2S Programme Board once the new governance framework takes effect, following the signature of the contracts with CSDs and non-euro area central banks. (Decision ECB/2012/6)

The T2S Board will include two non-central-bank members who can provide a client/user perspective but who are not associated with any specific client/user of T2S services. An open call for competition has been launched in order to fill these positions on the T2S Board. The deadline for applications is 25 May 2012.

The mandate of the new T2S Advisory Group is to ensure that T2S continues to meet the needs of the market. It will maintain its role as an advisory body to the Eurosystem for all T2S-related issues and may also advise the CSD Steering Group and the Non-euro Currencies Steering Group.

As part of preparations for the new T2S governance regime, which is to be fully implemented as of July 2012, the EBF, ESBG, EACB, AFME, and EACH are each invited to make proposals for nominations of members for the new T2S Advisory Group and for observers in the CSD Steering Group. Members of the above organisations who are interested in being part of the new governance bodies should inform their respective association in time for proposals to be submitted by the end of May 2012.

We are pleased to announce the publication of T2S in 2011, a comprehensive review of the project’s most important activities and accomplishments in 2011. While the T2S website and information sessions already keep the market and the public up to date on T2S and its developments, we deemed it useful and important to report in a single document the main achievements of the past year, in order to ensure transparency in the interests of all T2S stakeholders.

T2S in 2011 also includes an overview of the objectives of the T2S project and the benefits that it is expected to generate. We will continue working hard to ensure that T2S fulfils its potential to benefit Europe, ultimately making it a better place to invest.

We are happy to announce that the winter 2012 edition of the T2S OnLine Quarterly Review is now available for you.

In the editorial by Jean-Michel Godeffroy, Chairman of the T2S Programme Board, you will find his views about what it will mean to be part of the T2S Community for those CSDs and central banks that will soon enter into a contractual agreement regarding T2S with the Eurosystem.

More information on how the members of the T2S Community will cooperate and on what awaits them in 2012 is provided in “Bayle’s View”, along with a description of the T2S planning, monitoring and reporting framework.

As always, you will be offered a general update on the progress made by T2S over the last few months.

You will then be introduced to the two T2S Network Service Providers, SWIFT and a consortium composed of SIA and Colt, which have recently been awarded licences to provide T2S actors with value-added connectivity services. In our double-interview you will read about their motivation in becoming part of the T2S project, about their offers for prospective T2S customers, and about the next steps of their preparations for T2S.

Finally, SWIFT and SIA/Colt are also the protagonists of the last article of this issue of T2S OnLine, in which you will find a brief introduction to the people working in their T2S project teams.

We hope you will enjoy this edition of T2S OnLine!

The T2S Advisory Group endorsed the second progress report on T2S harmonisation (download) and acknowledged the positive developments since the publication of the first progress report in June 2011 (download). Progress has been achieved in the definition process, although further work is needed in the context of formal endorsement by the relevant bodies (Advisory Group, CSDs and the EU Commission, where necessary). Work on monitoring and implementation processes is currently at a less advanced stage. However, these processes are only relevant once the definition process has been completed.

The T2S harmonisation activities for which such monitoring is currently possible are: the T2S corporate actions standards, the market corporate actions standards (CAJWG standards), Settlement Finality II (irrevocability of transfer orders), omnibus accounts and securities amount data. Yvon Lucas, chairman of the HSG, said during the AG meeting on 30 November 2011: “Markets staying outside of T2S will not be monitored but kept informed on harmonisation progress”.

The report is the fulfilment of the Harmonisation Steering Group’s semi-annual task, as described in its mandate. It includes a detailed presentation of the status of each T2S harmonisation activity together with proposals to the Advisory Group for further action. The T2S Programme Board will present the harmonisation progress report (or parts of it) to the Governing Council of the ECB.

On behalf of the Eurosystem, the Banca d'Italia has awarded two T2S connectivity licences, the first to SWIFT and the second to a consortium composed of SIA and Colt.

As soon as the last administrative formalities have been completed, the two awardees will be invited to sign the Licence Agreement (LA) which is expected to happen this month. They will thereby become Network Service Providers (NSPs) within the meaning of the Licence Agreement and will soon afterwards publish their maximum prices.

T2S Actors (CSDs, central banks, and their customers) who intend to connect to T2S via a value-added connection will have to select one of these two NSPs, and will negotiate the relevant terms and conditions with them within the constraints set out in the Licence Agreement.

Dear T2S friends,

As the holiday season approaches, I would like to take this opportunity to look back at 2011 – a year with many challenges but also many great accomplishments.

2011 was indeed a great year for T2S, the year during which several cornerstones of the “T2S building” were laid down. One of them is the finalisation of the Framework Agreement. It has indeed taken more than two years of negotiations to complete this 700-page legal document, which covers all aspects of the project, including the governance structure, testing and migration, liability and termination, service levels and the project plan. The process has not always been easy, but the healthy discussion has helped in producing a robust agreement.

2011 was also the year in which the T2S key technical documentation (in particular the first version of the Users Detailed Functional Specifications) was published and connectivity providers were chosen. These cornerstones will enable CSDs to draw up their detailed feasibility assessments in the first part of 2012.

2012 will also be an important year, as it is the year in which CSDs and national central banks (NCBs) will finalise their strategies and find their place in the T2S planning. Clarity on this issue will help us define the composition of the T2S migration waves and testing groups, which is one of the main challenges ahead.

From a broader perspective, I hope that 2012 will also be the year to be remembered as the end-year of the financial crisis, in Europe and globally. Maybe you noted that, despite the present difficulties, the ECB and the Eurosystem have kept their determination to make T2S a success untouched. I leave it to you to meditate on this reality that you may have witnessed during our meetings. The crisis will end one day, T2S (and the euro) will still be there!

I would like to thank all of you for your continued commitment to the T2S project. The success of T2S will be your success! Special thanks in particular to the ECB and the 4CB teams who are working every day to make T2S a reality. I hope you will forget T2S and your other work obligations in the coming few days and I wish you, your families and your colleagues a Merry Christmas and a Happy New Year.

Jean-Michel Godeffroy, Chairman of the T2S Programme Board

On 17 November 2011 the Governing Council endorsed the T2S Framework Agreement and the related schedules. The Framework Agreement sets out the contractual rights and obligations of the Eurosystem and each contracting CSD, and covers the development and operation of T2S.

On 22 November 2011 the President of the ECB, Mario Draghi, transmitted the Framework Agreement to all of the CSDs that have participated in the negotiations over the past two years. In his letter, he formally invites the CSDs to sign the T2S Framework Agreement by 30 April 2012. Should CSDs require more time to complete their feasibility study, it is also possible to sign the Agreement by 30 June 2012 under the financial conditions specified in the set of incentives approved by the Governing Council. These will benefit those CSDs who sign and migrate early.

The Framework Agreement will become effective from the moment it is signed by the parties to the Agreement. more.

We are pleased to announce that the autumn edition of T2S Online in now available.

In this issue the Chairman of the T2S Programme Board announces the finalisation of the Framework Agreement and gives an update on the content of this extensive document and why it is in the interest of CSDs to sign it by April 2012. He confirms that the decision by the Bank of England and the Swiss National Bank, not to participate in T2S with their currencies, does not affect the price commitment of 15 cent per DvP instruction. In the T2S project update you can read the details of the “early bird” package that the Governing Council has decided to implement for CSDs that sign the Framework Agreement with the Eurosystem promptly.

In the Insight we have an article by Alberto Giovannini on the impact of the crisis and EU regulation on the market infrastructure as well as an article by Stephan Sauer on the future T2S Governance.

In Bayle’s view you can read more on the key technical building blocks of T2S and how the contractual rights and obligations of the Eurosystem and each contracting CSD are defined.

Finally, we are pleased to introduce the new member of the T2S Programme Board, Kristian Kjeldsen from Danmarks Nationalbank.

We hope you will enjoy this edition of T2S Online.

Publication of the T2S UDFS version 1.2 – basis for CSDs to carry out their feasibility assessments

The T2S User Detailed Functional Specifications version 1.2 (UDFS v1.2, Release note) is a major milestone in the T2S programme plan and illustrates features of T2S from a business perspective, provides details about application-to-application (A2A) dialogue between T2S actors and T2S and gives a detailed description of the set of messages processed by T2S. CSDs and national central banks (NCBs) can consider this version as the stable basis for their feasibility assessments for adapting to T2S. In addition it can be used by other directly connected T2S actors to design and build the interface of their information systems with T2S. More

Publication of the Dedicated Links Connectivity Specifications version 1.0

The T2S Programme Board is pleased to share the first version of the Dedicated Links Connectivity Specifications with the market. This version of the specifications contains information about the technical protocol for communication with T2S using dedicated lines.

Watch the proceedings of the T2S conference

On 4-5 October the T2S Programme Office hosted a conference entitled “Securities settlement in 2020: T2S and beyond”. Watch the highlights in the short video summarising the proceedings of the two days.

At its meeting on 20 October, the Governing Council decided that T2S will go live in June 2015, instead of in September 2014. That decision was based on a proposal by the T2S Programme Board that had reviewed the programme plan upon a request by the market to implement a number of changes to the T2S user requirements (see Editorial, T2S Online, July 2011).

The Programme Board’s review of the plan also identified a number of additional points that imposed time constraints on the current plan. Several stakeholders had found that the current time plan for testing T2S required additional time to guarantee a smoother implementation. It has therefore been agreed that CSDs in the first migration wave will be invited to participate in an additional pilot test, besides the already foreseen user testing.

In addition, analysing the best solutions for user connectivity to T2S has required more time than originally anticipated: (i) although the tender procedure for the VAN NSPs was launched in July, the selection process and implementation are likely to take longer than expected and (ii) a final decision on the solution for dedicated links still remains to be taken. Finally, with the review, the Programme Board has proposed to include a buffer in the time plan to provide for further essential requests for changes from the market.

Thank you to all those who joined us at the T2S conference held earlier this week in Frankfurt. In particular we would like to thank the panellists for providing many lively and thought-provoking discussions over the two days. We have received great feedback and hope you all enjoyed the event as much as we did!

A short video summarising the proceedings of the two days will be available shortly on the ECB website. Stay updated here on the T2S pages.

Conference proceedings

On 4-5 October a conference hosted by the European Central Bank entitled “Securities settlement in 2020: T2S and beyond” will be held in Frankfurt.

The conference will consider the future of post-trade industry from both a European and global perspective. Reflections on T2S will be the starting point for wider discussions on the global reshaping of the post-trade landscape.

Conference proceedings
Full conference programme

We hope you enjoyed this year’s T2S events. It was an eventful few days in Toronto, with a number of interesting presentations and discussions.

Here’s a reminder of the main events that took place: event flyer

The T2S event taking place today at SIBOS is as follows:

09:45am – 10:15am: Mini-session at stand B128

“Update on T2S user connectivity solutions”

10:45am – 11:30pm: T2S Case Study in the Standards Forum
“SWIFT Standards gets closer to its customers”

The following panellists will participate:

• Lorenzo Giammo, Banca d’Italia
• Siegfried Vonderau, Deutsche Bundesbank
  T2S Graphical User Interface (GUI) demo, GUI Demo User Guide
• Marc Bayle, European Central Bank

11:30am – 12:00pm: Mini-session at Stand B128

“The interconnection of TARGET2 and T2S”

The T2S event taking place today at SIBOS is as follows:

4:30pm – 5:00pm: Mini-session at stand B128

“How will T2S work and what will it look like?”

Tomorrow at SIBOS…

The T2S events taking place on Thursday 22 September are as follows:

09:45am – 10:15am: Mini-session at stand B128

“Update on T2S user connectivity solutions”

10:45am – 11:30pm: T2S Case Study in the Standards Forum
“SWIFT Standards gets closer to its customers”

The following panellists will participate:

• Lorenzo Giammo, Banca d’Italia
• Siegfried Vonderau, Deutsche Bundesbank
• Marc Bayle, European Central Bank

11:30am – 12:00pm: Mini-session at Stand B128

“The interconnection of TARGET2 and T2S”

The new addendum to the T2S brochure “T2S: halfway to delivery” is being launched today at this year’s SIBOS in Toronto!

Since the brochure was published in early autumn 2010, the Governing Council of the ECB and the T2S Programme Board have taken a number of decisions on the T2S project. This addendum provides an update on these decisions and developments and outlines the T2S Pricing Proposal.

Tomorrow at SIBOS…

The T2S events taking place on Tuesday 20 September are as follows:

10:00pm – 10:30pm: Mini-session at stand B128

“How the new T2S governance arrangement will continue to achieve consensus and transparency”

2:00pm – 3:30pm: Panel session in Community room 3

“Will the market deliver the cost efficiencies envisaged by T2S?”
Presentation

The following panellists will participate:

• Udo Braun, Commerzbank
• Diana Chan, DTCC/Euro CCP, Presentation
• Jean-Michel Godeffroy, European Central Bank
• Joël Mérère, Euroclear, Presentation
• Kevin Milne, London Stock Exchange Group
• Pervaiz Panjwani, Citi, Presentation

We are very pleased to invite you to the T2S events (download pdf) which will be taking place at this year’s SIBOS in Toronto from 19 to 23 September 2011. The main events are:

“T2S pricing and its impact on the securities settlement cost in Europe”

“Will the market deliver the cost efficiencies envisaged by T2S?”

The following panellists will participate:

• Udo Braun, Commerzbank
• Diana Chan, DTCC/Euro CCP
• Jean-Michel Godeffroy, European Central Bank
• Joël Mérère, Euroclear
• Kevin Milne, London Stock Exchange Group
• Pervaiz Panjwani, Citi

The following panellists will participate:

• Lorenzo Giammo, Banca d’Italia
• Siegfried Vonderau, Deutsche Bundesbank
• Marc Bayle, European Central Bank

We very much look forward to seeing you in Toronto! Stay updated right here on the T2S pages.

The Business Process Description (BPD) describes and illustrates the business processes for the interaction of central securities depositories, central banks and other parties that are technically directly connected with T2S. This draft version takes into account the comments received during the June 2011 market consultation and forms the basis for the second BPD workshop on 15 September 2011.

We are pleased to announce that the summer edition of T2S Online in now available.

In this issue the Chairman of the T2S Programme Board highlights the work done by the Advisory Group, focusing on the discussion which took place in the Group’s last meeting on 30 June and 1 July in Bucharest. In the T2S project update you can read the latest update on the Framework Agreement, the Currency Participation Agreement, connectivity issues to mention just a few.

In Bayle’s view you can find out all you need to know about the recently launched selection process for the T2S network service providers.

We also speak to the Governor of Danmarks Nationlbank, Hugo Frey Jensen, about the bank’s views on and its commitment to allow settlement of Danish kroner as well as euro in T2S.

Finally, we are pleased to introduce the newly created Harmonisation Steering Group chaired by Yvon Lucas.

We hope you will enjoy this edition of T2S OnLine.

On Tuesday, 26 October 2010, a Technical dialogue on T2S user connectivity, organised by De Nederlandsche Bank, was held at the premises of KAS BANK (see Eurosystem presentation, summary and Q&A).

The valuable input received during the technical dialogue and the questions received afterwards, have lead the Eurosystem to thoroughly reconsider its original approach. This has contributed to widen the range of choices for directly connected actors, in order to better support their individual business case. Of course this has resulted in significant changes in the earlier envisaged connectivity model, and consequently on the timing for the preparation of the documentation for the selection of the value-added network service providers. This documentation is available on the website of Banca d'Italia, who manages the selection process on behalf of the Eurosystem.

Interested parties can find more information in the official tender notice

All questions related to this selection procedure shall be sent to seli.dabsi@bancaditalia.it. A question of general nature and of interest to all potential bidders, as well as the answer thereto will be published on the same webpage as the selection documents, in anonymised form. Questions can be submitted by 23 September at the latest. As to questions received thereafter, a response will be provided on a best-efforts basis. The ECB and BdI are not responsible for the processing of questions or other messages not received through the e-mail address indicated above.

Market participants expect T2S to foster post-trade harmonisation. The Governing Council of the ECB has supported post-trade harmonisation since its decision to launch T2S on 17 July 2008.

As a consequence and since the start of the project, the T2S community has launched and/or contributed to several harmonisation initiatives.

In March 2011 the market stressed the need for T2S to become a catalyst for further progress on T2S harmonisation matters. This resulted in the creation of the Harmonisation Steering Group (HSG). It is chaired by Yvon Lucas and it will support the T2S Advisory Group in formulating and monitoring the T2S harmonisation agenda.

At the first meeting of the HSG on 5 May 2011 in Paris, Jean-Michel Godeffroy, chairman of the T2S Programme Board, commented, in reference to the HSG’s way of conduct, that “we should be modest and tough“ more

We are pleased to announce that the spring edition of T2S OnLine is now available.

This issue is dedicated to the T2S User Detailed Functional Specifications (UDFS) version 1.0 that has been published for market consultation (spotlight).

In his editorial, Jean-Michel Godeffroy, the Chairman of the T2S Programme Board, invites you to review the UDFS and to provide comments by 27 May 2011. In “Bayle’s view”, Marc explains why the UDFS is of key importance and why you should review it today.

In this issue, we have two insight articles. A round-table interview where we speak to the people behind the UDFS and ask them about their experiences. And an article by Stephanie Duverger where you will find out all you need to know about ISO 20022 messages in T2S.

Finally, we are pleased to be able to introduce the 4CB team behind the UDFS.

We hope you will enjoy this edition of T2S OnLine.

At its meeting of 22 March 2011, the T2S Programme Board approved the launch of a Public Market Consultation of the T2S User Detailed Functional Specifications (UDFS) version 1.0 (UDFS v1.0, Release note). Market participants are invited to review UDFS 1.0 and provide comments to T2S_specifications@ecb.europa.eu using the following template (Template for comments) by 27 May 2011.

The UDFS illustrate the features of T2S from a business perspective, provide details about the application-to-application (A2A) dialogue between T2S Actors and T2S, and give a detailed description of the set of messages processed by T2S.

This document represents a major milestone of the T2S programme plan. This version of the document (1.0) is based on the T2S User Requirements Document (URD) version 5.0 released in February 2010 (URD v5.0) and on the General Functional Specifications (GFS) version 4.0 issued in May 2010 (GFS v4.0) .

The Eurosystem will take into account market comments and will release UDFS version 1.2 at the end of October 2011 (including some additional technical messages not yet available). UDFS v1.2 will provide the basis on which directly connected T2S Actors will be able to design and build their information systems for communicating with T2S.

We are pleased to announce that the winter 2011 edition of the T2S OnLine Quarterly Review is now available for you.

In his editorial, Jean-Michel Godeffroy, the Chairman of the T2S Programme Board, reflects on how the business strategy adopted by CSDs for integrating T2S can enable them to reap its full benefits in future. The technical solutions available to CSDs for reshaping their infrastructure to T2S are then presented in detail in a dedicated article ("Bayle's view").

After a general update on the project’s status, you will find an interview with Jesus Benito, CEO of Iberclear, who, in his capacity of Chairman of the task force on smooth cross-CSD settlement, illustrates the task force's progress and objectives. There follows an interview with Paolo Cittadini, CEO of Monte Titoli, elaborating on the Italian CSD's recent decision to join T2S in its first migration wave in 2014.

Finally, we are glad to introduce you in this issue to the tasks and ongoing activities of the T2S National User Groups.

We hope you will enjoy this edition of T2S OnLine.

We are happy to announce that two further CSDs have committed to joining T2S in its first migration wave. Following the announcement made by BOGS, the CSD for Greek government securities, in May 2010, two other CSDs have announced that they also intend to join T2S in its first migration wave, namely Monte Titoli (Italy), part of the London Stock Exchange Group, and Depozitarul Central S.A. (Romania), part of the Bucharest Stock Exchange Group.

Jean-Michel Godeffroy, Chairman of the T2S Programme Board, says: “We are very pleased that Monte Titoli and Depozitarul Central S.A have now also committed to joining T2S in its first migration wave. Monte Titoli will bring to T2S a strong heritage of efficient and secure post-trade services, and the involvement of Depozitarul Central S.A. will extend the boundaries of T2S beyond those of the euro area from the very start”.

Kevin Milne, Director of Post-Trade Services at the London Stock Exchange Group, and Adriana Tanasoiu, CEO of Depozitarul Central, were united in expressing their delight to have been selected to partner the Eurosystem in this important development. Joining T2S would be, they both declared, “great news” for their respective customers, enabling them to settle all of their euro area and other T2S securities in central bank money (see press releases: http://www.londonstockexchangegroup.com/newsroom/2011pressreleases/2011-press-releases.htm and http://www.roclear.eu/home/index.aspx).

The T2S migration phase will be composed of three migration waves and one contingency wave. The first migration wave is scheduled for September 2014.

For more details, click here.

The next T2S info session will be hosted by the Deutsche Bundesbank and held in Frankfurt at the Deutsche Nationalbibliothek on 25 January from 10.00 to 16.30. The info session will provide an update on issues related to programme planning, pricing, user connectivity and network provision, harmonisation, and how the central securities depositories (CSDs) can reshape their infrastructure to get the most from T2S.

The draft agenda can be found here.

If you would like to attend please register at t2-s@ecb.europa.eu

Dear T2S stakeholders,

As 2010 draws to a close, it is time to look back at the many things we have accomplished over the course of this eventful year in terms of the financial package, the governance, the freezing of the User Requirements Document and the publication of the final General Functional Specifications. All this has been possible thanks to the efforts of qualified and committed professionals, as well as the ongoing open dialogue within the T2S community. Professionalism, commitment and transparency are the key ingredients of T2S.

However, a project would not be a success if challenges were not met and subsequently overcome along the way. T2S is a project without precedent, and our review in 2010 has strengthened our organisational structure, brought about progress in the work on the key technical documentation, advances in the legal foundation for T2S, an agreement on the pricing policy, and much more besides.

The key challenges for 2011 will be: first, the finalisation and signing of the Framework Agreement and the Currency Participation Agreement with the participating CSDs and NCBs, respectively; second, the gradual finalisation of the User Detailed Functional Specifications, which are eagerly awaited by the T2S stakeholders; third, the selection of three network providers; and fourth, the definition and monitoring of major harmonisation priorities, in cooperation with the T2S user community. These will be major milestones for 2011, which will serve as an indication of the ultimate level of commitment to T2S.  

We would like to take this opportunity to thank you all for your support and commitment to the T2S project, and to wish you, your colleagues and your family a happy festive season and all the best for the New Year.

Jean-Michel Godeffroy, Marc Bayle and all the ECB T2S Team.

The autumn edition of the T2S OnLine Quarterly Review is now available for you both on the web and in printable format.

This issue opens with the reflections of Jean-Michel Godeffroy, the Chairman of the T2S Programme Board, on the recent decisions concerning T2S pricing, as well as on the ongoing dialogue with non-euro area stakeholders and the importance of harmonisation for T2S.

The key topics of pricing and harmonisation are then further elaborated upon in two dedicated articles. In addition to a general update on the project’s status, you will also find in this issue the views of two representatives from the T2S community in a "double interview" with the CEOs of the Polish and Romanian CSDs.

We hope you will enjoy this edition of T2S OnLine.

The Governing Council of the ECB has decided to set the delivery-versus-payment price for T2S at 15 cent per instruction, provided that a number of conditions are fulfilled. This price will be fixed for the period from September 2014, when T2S will go live, to December 2018. For more information please see Press release and T2S Pricing.

• On Wednesday, 27 October 2010, a special interest session was held on the topic “Cost efficiency of securities settlement in a T2S environment”. The panel, chaired by Jean-Michel Godeffroy and involving CSD and market representatives, discussed about T2S pricing, CSDs' adaptation to T2S and the need for harmonisation in the post-trade area.
• On Tuesday, 26 October 2010, Helmut Wacket, Head of the Policy and Marketing team in the T2S Programme Office at the ECB, explained the T2S pricing proposal in an "open theatre session" at SIBOS (download presentation). More on the T2S pricing proposal
• On Monday, 25 October 2010, Jean-Michel Godeffroy, Chairman of the T2S Programme Board, introduced the new T2S publication T2S: half-way to delivery, the new design of the T2S WebPages, as well as 3 short videos about T2S.

• On Tuesday, 26 October 2010, a Technical dialogue on T2S user connectivity, organised by De Nederlandsche Bank, was held at the premises of KAS BANK. The discussion was based on a Eurosystem presentation. The transcript of the debate will be published soon.

• On Tuesday, 26 October 2010, Helmut Wacket, Head of the Policy and Marketing team in the T2S Programme Office at the ECB, explained the T2S pricing proposal in an "open theatre session" at SIBOS (download presentation). He emphasized that the T2S Programme Board will propose to the Governing Council of the ECB to set the DvP (Delivery-versus-Payment) price for T2S at 15 cents per instruction until end-2018, provided that certain conditions are fulfilled. He also pointed out that the T2S Programme Board aims at further reducing settlement fees thereafter. More on the T2S pricing proposal
• On Monday, 25 October 2010, Jean-Michel Godeffroy, Chairman of the T2S Programme Board, introduced the new T2S publication T2S: half-way to delivery, the new design of the T2S WebPages, as well as 3 short videos about T2S.

• On Tuesday, 26 October 2010, a Technical dialogue on T2S user connectivity, organised by De Nederlandsche Bank, was held at the premises of KAS BANK. The discussion was based on a Eurosystem presentation. The transcript of the debate will be published soon.

Come and visit us at SIBOS

• Wednesday, 27 October from 14:00 to 15:40: special interest session in Community room 2 chaired by Jean-Michel Godeffroy and titled “Cost efficiency of securities settlement in a T2S environment”. The following esteemed panellists will participate:
  
  - Marc Bayle, European Central Bank
  - Paul Bodart, Bank of New York Mellon
  - Paolo Cittadini, Monte Titoli
  - Jane Levi, Association for Financial Markets in Europe
  - Andreas Wolf, Clearstream Banking Frankfurt
  

We very much look forward to seeing you in Amsterdam!

On Monday 25 October 2010, a T2S welcome reception was held at the Eurosystem stand (stand C315). Jean-Michel Godeffroy, Chairman of the T2S Programme Board, opened the reception saying: "At the current juncture, the project is exactly half-way to delivering T2S. This is a good moment to reflect on what has been achieved, where we stand and what remains to be done." For this purpose, he introduced the new T2S publication T2S: half-way to delivery, which also offers some reflections on the questions raised by the market about some crucial issues.

In addition, Godeffroy introduced the new design of the T2S WebPages, as well as 3 short videos about T2S: the first one is a short trailer, very general; the second one gives an insight on the benefits brought about by T2S; the third one is a short animation on how T2S will work in practice.

Come and visit us in Amsterdam

We are very pleased to invite you to the T2S events which will be taking place in Amsterdam from 25 to 29 October 2010.

• Tuesday, 26 October 2010, from 10:45 to 11:15: open theatre session (Open Theatre 2). The session will be devoted to explain the T2S pricing proposal.
• Wednesday, 27 October from 14:00 to 15:40: special interest session in Community room 2 chaired by Jean-Michel Godeffroy and titled “Cost efficiency of securities settlement in a T2S environment”. The following esteemed panellists will participate:
  - Marc Bayle, European Central Bank
  - Paul Bodart, Bank of New York Mellon
  - Paolo Cittadini, Monte Titoli
  - Jane Levi, Association for Financial Markets in Europe
  - Andreas Wolf, Clearstream Banking Frankfurt
  

• Tuesday, 26 October 2010, from 8:30 to 11:30: Technical dialogue in the context of T2S user connectivity. The event, organised by De Nederlandsche Bank, will take place at the premises of KAS BANK Nieuwezijds Voorburgwal 225, 1012 RL Amsterdam. more.

We very much look forward to seeing you in Amsterdam!

We are very pleased to invite you to the T2S events which will be taking place in Amsterdam from 25 to 29 October 2010.

• Monday, 25 October 2010, from 17:00 to 18:00: welcome cocktail reception at the Eurosystem stand (stand C315). We will release the new T2S publication “T2S: half-way to delivery”.
• Tuesday, 26 October 2010, from 10:45 to 11:15: open theatre session (Open Theatre 2). The session will be devoted to explain the T2S pricing proposal.
• Wednesday, 27 October from 14:00 to 15:40: special interest session in Community room 2 chaired by Jean-Michel Godeffroy and titled “Cost efficiency of securities settlement in a T2S environment”. The following esteemed panellists will participate:
  - Marc Bayle, European Central Bank
  - Paul Bodart, Bank of New York Mellon
  - Paolo Cittadini, Monte Titoli
  - Jane Levi, Association for Financial Markets in Europe
  - Andreas Wolf, Clearstream Banking Frankfurt
  

• Tuesday, 26 October 2010, from 8:30 to 11:30: Technical dialogue in the context of T2S user connectivity. The event, organised by De Nederlandsche Bank, will take place at the premises of KAS BANK Nieuwezijds Voorburgwal 225, 1012 RL Amsterdam. more.

We very much look forward to seeing you in Amsterdam!

To allow the relevant T2S stakeholders, including potential network service providers, to contribute to a discussion on the T2S User Connectivity, the Eurosystem organises a technical dialogue in Amsterdam on 26 October 2010.

For more details about this event, please click here.

On 16 September 2010, the Governing Council of the ECB appointed the eight members and five alternates of the T2S Programme Board for the second term, commencing on 1st November 2010.

The T2S Programme Board ensures that the T2S Programme is developed in time, on budget and in accordance with market expectations.

See the press release.

In line with the transparency that has always characterised the T2S project, the T2S Programme Board has shared with market participants in the T2S Advisory Group the first preliminary figures regarding future T2S costs and pricing. These figures are still subject to discussion, but give some indication of future T2S prices.

For an overview of this preliminary cost and pricing information and its evolution, please click here.

The summer edition of the T2S OnLine quarterly review is now available both on the web and in printable format. In his editorial, Jean-Michel Godeffroy, Chairman of the T2S Programme Board, describes the progress made in defining future T2S governance. The issue also includes a project update, information on key policy and technical issues, and an interview with Göran Fors and Henry Raschen, Chairs of the Swedish and UK National User Groups. Finally, it introduces the reader to the CSD Contact Group.

In an interview with the Romanian media company Mediafax, Jean-Michel Godeffroy, Chairman of the T2S Programme Board, shares his views about the impact of T2S on the post-trading landscape in Europe, with a particular focus on the Romanian CSD. (Interview)

The July issue of the FSR (Financial Services Research) deals with the status and challenges of the T2S project. It includes an interview with Jean-Michel Godeffroy, Chairman of the T2S Programme Board, as well as contributions by representatives from the private sector. (Spotlight)

The July issue of the FSR (Financial Services Research) reports on T2S, which is scheduled to go live in September 2014.

Jean-Michel Godeffroy, chairman of the T2S Programme Board, answers some key questions about the progress of the T2S consultation process and what remains to be done prior to the go-live in September 2014. (see article)

Andreas Wolf (Clearstream), Yveline Herfeld (CACEIS) and Robert Barnes (UBS Investment Bank) describe the private sector’s views about T2S.

Finally, Bob Currie, FSR Editorial Director, shares opinions on T2S gathered from leading private sector representatives through various interviews. (www.fsresearch.co.uk)

On 22 June 2010 KELER, the Hungarian central securities depository (CSD), signed (see document) the T2S Memorandum of Understanding (MoU) with the Eurosystem. In doing so, it joined the 29 other CSDs in 27 countries who had previously signed the MoU, formally confirming their strong support for T2S.

This group of CSDs included not only all those in the euro area, but also eight CSDs located in EU Member States outside the euro area – Denmark, Estonia, Latvia, Lithuania, Poland, Romania, Sweden and the United Kingdom – and three located in countries outside the EU – Iceland, Norway and Switzerland. The CSDs of Denmark, Norway and Sweden – with the support of their central banks and the market – also signed up for settlement in T2S in their domestic currency, as well as in euro.

The signing of the MoU by KELER marks a further step in T2S’s ambition to become the future settlement infrastructure for Europe.

We warmly welcome KELER to the T2S community.

At its meeting of 27 and 28 May 2010, the T2S Programme Board approved version 4.0 of the General Functional Specifications (GFS v4.0). They are based on the “frozen” User Requirement Documentation (URD v5.0) and embody the functional design of T2S services (document, annex).

The publication of GFS v4.0 represents another major step in strengthening T2S foundation.

Further technical information is provided via the T2S Data Model (T2S Data Model).

The CSD for Greek government securities (BOGS) will be in the first migration wave to join T2S. BOGS will be testing the new T2S platform at the latest as of January 2014 and may even engage in pilot testing before that time. BOGS will be ready to start T2S operations in September of the same year.

“T2S will be a major opportunity for the Greek market, as it will offer inexpensive and efficient access for issuers and investors to settle domestic and cross-border trades in Europe” said Kyriaki Vatista, Head of BOGS.

Jean-Michel Godeffroy, Chairman of the T2S Programme Board, welcomed the decision of BOGS by stating: “We appreciate the choice made by BOGS. It is an important step in the project and I am confident that it will contribute to crystallise further the engagement of other stakeholders.”

BOGS was created in 1995 by the Bank of Greece and processes 400,000 transactions a year to the value of €6.4 trillion (2009).

The spring edition of the T2S OnLine Quarterly Review is available as of 26 April 2010.

This edition will provide you with first hand information about the T2S programme, including key new dates and a complete project update. But one should not forget that behind any project there are people: in this edition we interview Adolfo García of Banco Santander and introduce the T2S Advisory Group.

We hope you will enjoy this issue of T2S OnLine.

On 27 April a funds workshop will be held at Banque et Caisse d’Epargne de l’Etat in Luxembourg. The workshop will address issues related to the settlement of funds in T2S, the role of transfer agents, harmonisation trends and how T2S will impact the processing of funds. A general presentation on T2S from the perspective of the funds industry will also be given (draft agenda).

Experts from the funds industry are invited to show their interest (t2-s@ecb.europa.eu ).

In the last quarter of 2009, the standards on corporate actions were approved by the T2S Advisory Group and endorsed by the European Commission’s Clearing and Settlement Advisory and Monitoring Expert Group.

The T2S Corporate Actions Subgroup (CASG) is monitoring the implementation of the standards in the T2S markets. CASG members (download list) will contact the relevant CSDs and local markets to analyse their readiness to implement the standards.

In 2009, 28 CSDs located in 26 countries signed the Memorandum of Understanding (MoU) with the Eurosystem thus formally confirming their strong support for T2S and gaining membership to the CSDs Contact Group where the T2S Framework Agreement is prepared.

On 10th February, KDPW (the Polish CSD) also signed the MoU, thus bringing us another step closer towards achieving our ambitious single market objective for the European financial market. This increases the number of CSDs which have signed the MoU to an impressive 29.

We welcome KDPW in the T2S community.

The ECB Governing Council has decided to freeze the User Requirements Document for T2S (URD) following the recommendation of the T2S Programme Board and the Advisory Group.

Version 5.0 of the URD is the result of the very constructive co-operation between the market and the Eurosystem, and represents a key milestone in the project development.

On 15 January 2010 the T2S Advisory Group approved the mandate of the Task Force on Shareholder Transparency, which will be chaired by Paul Bodart. The new task force will analyse the issue of shareholder transparency with a view to fostering market harmonisation and European integration. We encourage specialists to send their applications to the T2S Team by 31 January 2010.

Furthermore, following the decision of the Governing Council of the European Central Bank to prolong the mandate of the current T2S Advisory Group, it was also decided to increase the number of user representatives within the Group. Candidates are invited to submit their applications T2S Team by 15 February 2010.

After the publication of the General Functional Specifications and the General Technical Design, respectively in November and December 2009, the T2S Programme Board has now approved the General Specifications. The General Specifications focus on the implementation of those user requirements that do not have a functional or technical dimension (operational support, testing, migration and information security). The General Specifications represent the last document of the “trilogy”, i.e. the General Functional Specifications, the General Technical Design and the General Specifications, which together describe how the Eurosystem envisages the implementation of the User Requirement Documentation.

The T2S Advisory Group decided to recommend to the T2S Programme Board and the Governing Council to “freeze” version 5.0 of the URD. This major step means that the development of T2S will have a fully stable basis. Version 5.0 of the URD is the result of the very constructive co-operation between the market and the Eurosystem.

These achievements represent major steps in the T2S programme plan. An update of the T2S programme plan will be undertaken until the end of February. The programme plan includes all activities necessary for the completion of T2S. It will of course be coordinated with the plans of the CSDs and Users.

The T2S operational framework defines the roles and responsibilities of all T2S Actors in the day-to-day management of the T2S system, covering the activities of the T2S Operator (i. e. the 4CB), the CSDs, directly connected T2S Parties and the central banks. The operational framework also defines how business activities are co-ordinated in both normal and abnormal circumstances.

The preparation of the operational framework is progressing well thanks to the work of the Sub-Group on Operational Framework (SGOF). All information related to the SGOF and its work is currently available under http://www.ecb.europa.eu/paym/t2s/governance/prog_board/html/subopframe/index.en.html.

Dear T2S stakeholders

As the end of the year approaches, many of us take time to reflect on the past 12 months. 2009 has been a year full of challenges and achievements for T2S and its community.

The challenges have made us stronger and better prepared to deliver a T2S up to market expectations. There are many challenges ahead of us, but we are well equipped to deal with them.

Our achievements have shown how important and steadfast your support is. We have witnessed this in many ways, including the signature of the Memorandum of Understanding, the good attendance at meetings and info sessions, and the effective cooperation within our community.

For all this, we would like to thank you, and we wish you and your family happy holidays and all the best for the New Year.

Jean-Michel Godeffroy, Marc Bayle and the entire T2S Team

The T2S Programme Board has approved the final version of the General Technical Design (GTD) version 2.2, see cover letter.

The GTD presents an overview of the technical infrastructure which 4CB intend to implement in order to run the future T2S application. (document).

At its meeting of 12 and 13 November 2009, the T2S Programme Board approved the final version of the T2S General Functional Specifications (GFS), see cover letter by the T2S Programme Board.
The GFS describes how the User Requirements expressed by the market will be satisfied by the T2S platform (document, annex).

This version of the document (3.0) presents the functional architecture of the T2S application based on the version 4.2 of the user requirements (URD v4.2) including the change requests validated by the AG until September 2009.

Further technical information is provided via the T2S Data Model

Jean-Michel Godeffroy, chairman of the T2S Programme Board and Director General at the ECB, spoke at the European Transaction Banking Conference on 16 November. In his speech he addressed “Europe after the T2S Revolution – what will change for you?” [please see speech]. …At a time when it is fashionable to be negative about banks, I am happy to say that …bankers have proved themselves to be consistent when claiming to be in favour of free competition and European integration…

The conference was well visited by stakeholders from all of Europe.

The T2S team of the ECB will participate in the Euro Finance Week on 16 and 17 November in Frankfurt, at the Congress Centre Messe, stand 2.12.

We would be very happy to meet any one who wants to know more about the T2S project. T2S is being built by the Eurosystem on a not for-profit basis, i.e. solely for the benefit of the users, and only through strong collaboration with all stakeholders can we fulfil our vision of building a truly state of the-art settlement system.

On the same occasion, we will also participate in the European Transaction Banking Conference. Jean-Michel Godeffroy, Chairman of the T2S Programme Board and Director General at the ECB will address “Europe after the T2S revolution” in a key note speech at 9 a.m. and Helmut Wacket, Head of Section in the T2S Division at the ECB, will participate in the panel on “Clearing Architecture of Tomorrow” at 11 a.m.

Conference programme

At its meeting of 22 October 2009, the Governing Council has approved the note on the Nature of outsourcing in T2S. The purpose of this Note is to clarify the nature of outsourcing in T2S from the perspective of the Eurosystem. Though it is acknowledged that the use of the T2S services involves an important element of outsourcing, it is stressed that T2S goes beyond a conventional IT service provider, given that the owner and operator of T2S will be the Eurosystem, that T2S provides for real-time delivery versus payment settlement of securities transactions in central bank money and pursues the overarching objective of facilitating further European integration in clearing and settlement through enhanced competition among market participants.

The Note emphasises the wider objectives of T2S and its main principles.

Transparency and the close involvement of market participants are two trademarks of T2S. Therefore, the T2S Team regularly seeks interaction with market participants to update them on latest developments, including discussions at the recent AG meeting, and to seek their views on specific topics of interest. This interaction takes place via the so-called ‘Info-sessions’ which are held in different cities across Europe. The last Info-session took place on 7 October 2009 in Luxembourg.

The event included three panel sessions addressing:

• Future developments in the European post-trade environment and their impact on settlement volumes;
• Optimised liquidity provision in T2S; and
• T2S and the funds industry.

A summary and pictures of the event have been published on the website. The next Info-session will take place 14 January in Amsterdam.

T2S will bring numerous benefit and challenges to a remarkable number of stakeholders. Therefore, their involvement is of key importance to the Eurosystem. Interaction with market stakeholder takes place via different channels, and in different fora.

The Advisory Group is at present the main external governance forum. It consists of more than 80 senior representatives of central banks, central securities depositories, users and other stakeholders. The Advisory Group meets four times a year usually at the ECB premises in Frankfurt. However, once a year participating institutions invite the members of the Advisory Group for a meeting abroad.

In September 2009, HSBC invited the Advisory Group for a meeting in the beautiful Guildhall in Livery Hall, London.

An impressive number of CSDs – 27 in total located in 25 countries – signed the Memorandum of Understanding (MoU) on 16 July thus reinforcing their strong support for T2S.

This included not only all CSDs that exist in the euro area, but also seven CSDs located in EU countries outside the euro area – Denmark, Estonia, Latvia, Lithuania, Romania, Sweden, UK – and two CSDs located in countries outside the EU – Iceland and Switzerland. The CSDs of Denmark, Lithuania and Sweden – with support of their central bank and the market – also signed up for settlement in T2S in their domestic currency as well as in euro.

In early September, VPS (the Norwegian CSD) informed (letter, 65.9 kB) that also they decided to sign the MoU, and the Norges Bank (letter, 612 kB) declared its intention to allow also for settlement in Norwegian kroner in T2S.

We welcome them in the T2S community.

The Eurosystem will again be exhibiting at SIBOS from 14-18 September 2009, with T2S taking a prominent role.With the recent signing of a Memorandum of Understanding with 27 CSDs from 25 countries, we have much to celebrate.

While we are at SIBOS, we would be very happy to meet anybody who wants to know more about the project. This project is being built by the Eurosystem on a not for-profit basis, i.e. solely for the benefit of the users, and only through strong collaboration with all stakeholders can we fulfil our desire to build a truly state of the-art settlement system.

We plan to have a special focus session on Tuesday, 15 September, from 2 p.m. to 3 p.m. in room S226-S227, which will be chaired by the Chairman of the T2S Programme Board, Jean-Michel Godeffroy (presentation, 1.72 MB).

Marc Bayle will be providing an update on the latest project developments, which will be followed by a panel discussion between several CSDs and large banks on how they plan to adjust their business models in the light of T2S.We will also be having a T2S cocktail reception in order to have discussions on a more informal level.This will take place at the Eurosystem stand 3G19, starting at 4 p.m. on 16 September.