TARGET2/T2S Consolidation

 

TARGET2/T2S Consolidation and Liquidity Management

With TARGET2 Securities, the ECB has just created a high-performance platform for implementing securities transactions in Central Bank money. Not only were the basic components implemented but also new functions in the area of (intraday) liquidity management and (auto) collateralization. Due to the changes that the ECB has already decided on as part of the T2/T2S consolidation, liquidity management in particular is now becoming a focus point. The future real-time gross settlement service (RTGS, currently TARGET2) will provide a number of options to manage payments on a liquidity-optimized basis – both for managing the RTGS account and across modules for T2S and TIPS. The account structure within the Eurosystem will change: liquidity will be controlled via a central account in the future.
Read our blog post about this: CENTRAL LIQUIDITY MANAGEMENT

Significant opportunities

The effects of the T2/T2S consolidation for the affected banks and financial institutes thus go far beyond the transition to the ISO 20022 message standard: technical and organizational processes in payments and at the interface to the liquidity management will also change. Challenges – and significant opportunities – will also arise due to the introduction of TIPS, which makes it possible to implement instant payments in Central Bank money.  

Initiate the transition now

In view of the already defined milestones for TARGET2/T2S consolidation and a tight schedule until the go-live in November 2021, banks and financial institutes are forced to act already now and initiate the necessary transition activities for payments and liquidity management. syracom already supports several banks in introducing T2S, consolidating the T2/T2S platform, and exploiting resulting synergies. 
Read more about this topic in our blog: THE CONSOLIDATION OF TARGET2 AND T2S IS MOVING FORWARD

Interested?

Call me or write me

Harald Keller

Head of the Competence Center for Payment Transactions and Treasury

Phone: +49 6122 9176 0