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Contributing Partner(s)
Lead
Venkatesh leads and manages all the knowledge management activities of the network around T2S. Know more about Venkatesh Subramanian.
Supporting
Prema extensively contributes to the knowledge management activities of the network around T2S. Know more about Prema Aiyer.
Naresh also contributes to the knowledge management activities of the network around T2S. Know more about Naresh Khiviraj.
T2S
Target2 Securities is a major initiative and investment by the European Central Bank to create a world class infrastructure to support delivery versus payment mechanism in central bank money. Starting from June 2015 till middle of 2017, European Union Central Securities Depositories (CSDs) will start outsourcing their settlement functions to T2S.
T2S eliminates the key post trade risk of non real-time gross settlement in central bank money from all the European Union CSDs. T2S also provides an uniform and consistent method of settlement across the European Union. Finally T2S creates a new platform to have a cross border delivery versus payment in central bank money within the European Union which has been missing so far.
All of this will provide an open access to the custodians and participants to easily access multiple EU markets. This will create competition among the Central Securities Depositories to provide best in class complementary services such as asset servicing, lending and borrowing and collateral management to keep their clients from migrating to other Central Securities Depositories.
This transformation journey for the capital markets in the European Union will last a decade or more as T2S goes live in June 2015 with the first wave of participant countries till the time the market forces provide the necessary consolidation and efficiencies. At last European Union can truly act as an integrated capital market rather than a disparate set of capital markets of member countries.
Transformational impacts we see due to T2S are:
- Central Securities Depositories will slowly rework their cross border links to exploit the T2S platform. They will also look for new clients and new business models where the focus is not just their country, but a group of European Union countries to meet the competitive pressures from the open access to their markets created by T2S. This will mean significant investments into their systems and processes to be able to provide consistent and competitive European Union wide services for complementary services such as connectivity and information management, asset servicing, securities lending and borrowing, REPOs and collateral management
- Local and regional custodians will start focusing purely on the end clients’ (i.e, private banking, funds and Global custodians) business rather than the current European institutional cross border business as these cross border links becomes simpler and will no longer go through them. They will also be presented with an opportunity to truly simplify their multi country systems and processes and to reduce their costs dramatically
- Global custodians will start looking at the possibility of directly entering the European markets as T2S will provide them a much simplified and cost effective access to all the European markets
If you are client wanting to know more about how we can help your T2S transformation journey kindly visit Consulting→T2S section of our web-site.
If you are a professional involved in this area and want to keep yourselves abreast or to explore additional possibilities with us visit Join Us→Contributing Partner section of our web-site.