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The ECB believes an integrated securities settlement infrastructure in the euro zone could cut settlement costs by up to 90%. The system would connect all clearing networks in the euro zone into a single platform, extending the payments system used for central bank operations to cover securities settlements.
But according to a Financial Times report a panel reporting to EU finance ministers is expected to say that the ECB needs to undertake another feasibility study and provide a business case for the integrated settlement infrastructure, dubbed Target2-Securities. Earlier this month the European Central Securities Depositories Association (ECSDA) - a trade association of 42 settlement bodies - called for the ECB to postpone the plans and conduct further study and consultation.
Meanwhile finance ministers in a number of EU member states - the UK, the Netherlands, Belgium and Sweden - have reportedly raised fears about the scheme, including concerns that the settlement system could become a public monopoly.
According to the FT, the ECB expects a decision on Target2-Securities by its governing council in March, rather than late February as originally envisaged, to take into account of the concerns of finance ministers