Euroclear to join ECB Target-2 Settlement system

Lieve Mostrey, CEO, Euroclear Group

Euroclear Bank, the Brussels-based international central securities depository (ICSD), signed an agreement with the European Central Bank and the central banks of the eurozone to join ECB’s TARGET2-Securities (T2S) settlement system.

TARGET2-Securities offers centralised settlement in central bank money across European securities markets.

It aims to reduce European fragmentation and make central bank money securities settlement more efficient by helping to reduce risk and increase liquidity.

By connecting to the T2S platform, Euroclear said its clients will have the choice between euro settlement in either commercial bank or central bank money.

They will also have access to one single pool of liquidity and collateral across multiple currencies and jurisdictions.

In addition, the ICSD said, the connection will allow them to further optimise the management of their liquidity and reduce their financing costs.

“I welcome Euroclear Bank’s decision to join the T2S platform and our journey towards European financial integration and a single capital market, “said Ulrich Bindseil, director general, market infrastructure and payments, European Central Bank.

He added, “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, Euroclear Group noted, “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.

She said, “The signed agreement signifies an important step in providing further support to EU’s ambitions of strengthening the euro’s international role.”

©Markets Media Europe 2021

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