|
|
The debate, chaired by the ECB and featuring representatives from the central securities depositories (Euroclear and Clearstream) and the agent banks (JP Morgan and Deutsche Bank), focussed on the progress that has been made toward establishing the settlement platform in time for the 2013 deadline.
The CSDs, who are likely to see their revenues reduced when T2S is introduced, urged the ECB not to underestimate the barriers that will exist and not to overstep its original remit. "The scope of T2S is an enormous challenge," said Mark Gem, head of business management at Clearstream Banking. "There are plenty of barriers that remain in creating a single pan-European market and they will still be there in 2013. T2S should stick to its mandate and remain lean and focused."
However, the banks were equally vocal about the CSDs’ need to listen to their own customers - the banks - and to ensure that transaction costs are reduced and services are not duplicated once T2S goes live. The banks also called for a more inclusive approach to future T2S debates. "We the users believe we can give valuable advice but we feel that you (the CSDs and the ECB) try to exclude us from the conversations," said Stephen Lomas, managing director, Deutsche Bank. "Please do us a favour and let us in. Do not try to fight us."
Concerns over pricing and governance aspects clearly remain for both banks and CSDs, especially as regards contracts. "The biggest challenge over the next few months will be to get contractual agreement between the CSDs and their customers and to get the various pricing and governance issues articulated and discussed," said Gem.
"In most banks the cash and securities teams are in different departments and this is the problem. Cash management teams would like to be more included in the T2S discussions. We need to ensure there is a forum to make sure that these issues don't cause any concern and that they are resolved now rather than in 2012."