T2-T2S consolidation: Information on the production launch in March 2023
Clearstream Banking AG, Frankfurt1 informs customers about the upcoming ECB T2-T2S consolidation go-live in March 2023. The release will be deployed on
the weekend of 18 and 19 March 2023
for business day Monday, 20 March 2023
Background
This consolidation will optimise the liquidity management across all the TARGET services and meet the changing market demands to existing and future Eurosystem payment and settlement services.
As per the decision of the ECB, the project will be implemented using a “big-bang approach”, that is, simultaneous discontinuation of the current TARGET2 (T2) Single Shared Platform (SSP).
Further information on the scope has been published by the ECB.
The implementation strategy of CBF’s functionality is outlined in Announcement D20027.
Potential impact on customers
As described in Announcement D20027, CBF‘s strategic approach is to migrate all current Central Bank Money (CeBM) services using the Ancillary Systems (AS) interface in T2 to a TARGET2-Securities (T2S) service by means of Payment Free of Delivery (PFoD) instructions. The last settlement instruction of subscription rights for DE ISINs, currently still settled as Ancillary Service P3 in the Direct Debit (DD) cycle, will also be migrated to PFoD as a precursor to the Corporate Action Harmonisation (CAH) project. For further information, please refer to Announcement D23002.
As all CeBM cash flows will be migrated out of T2 ASI procedures latest by the T2-T2S consolidation project of the Eurosystem, CBF will cease to be an Ancillary System post consolidation.
Future Liquidity management
With the implementation of the T2-T2S consolidation project in March 2023 the liquidity management procedures will be modified. The new T2 platform offers “Direct Participants” the following options for liquidity management:
- Immediate Liquidity Transfer via T2 Real-Time Gross Settlement (RTGS) GUI:
T2 RTGS GUI can be used to transfer funds from the RTGS Dedicated Cash Account (DCA) to the T2S DCA. For details on how to use this functionality, please refer to section “Liquidity Transfer – New Screen” of the Real-Time Gross Settlement User Handbook. - Immediate Liquidity Transfer via T2 Central Liquidity Management (CLM) GUI:
T2 CLM GUI can be used to transfer funds from the CLM Main Cash Account (MCA) to the T2S DCA. For details on how to use this functionality, please refer to section “Liquidity Transfer – New Screen” of the Central Liquidity Management User Handbook. - Configure Standing Orders in Common Reference Data Management (CRDM):
Standing order for liquidity transfers can be created via CRDM GUI (U2A). This functionality offers the possibility to create a daily liquidity transfer. Standing orders can be configured to execute at a certain time or for certain events. Please refer to the Common Reference Data Management User Handbook regarding the setup and the related fields descriptions. - Liquidity Transfer via A2A camt.050 message:
Participants can use the A2A channel for liquidity transfers from the RTGS DCA or the CLM MCA to the T2S DCA. If this is the case, the participant must provide in the creditor account of the T2S DCA to be funded. Please refer to the Real-Time Gross Settlement User Detailed Functional Specifications and the Central Liquidity Management User Detailed Functional Specifications.
In addition, today's automated “T2S Cash Sweep out” to clear the balance on the T2S DCA with a simultaneous transfer of cash to the T2 DCA will become optional. A sweep out can be achieved by setting up a standing order in CRDM with event type execution time as Optional Cash Sweep2 (OCS2). If customers require an automated liquidity transfer to the RTGS DCA, it is mandatory that a standing order is set up.
Transition plan
The deployment will be executed via the “Release Weekend Schedule”. In line with the deployment approach of standard T2S Releases, the schedule of the T2S Operational Day will be modified according to the implementation activities. The deployment will start once the end of day procedure (“T2S End of Day”) on Friday, 17 March 2023, has been completed. Customers are requested to note that the availability of T2S is affected due to the deployment activities. For changes in the operational day during the deployment weekend, please refer to CBF’s indicative timeline document to be published in due course on the Clearstream website.
Further information
Please contact Clearstream Banking Client Services for questions regarding the functionality. Questions related to the technical connection can be addressed to our Connectivity Support. Questions related to the Release in November 2020 about the T2-T2S consolidation project will be routed to the project team.
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1. This Announcement is published by Clearstream Banking AG (CBF), registered office at Mergenthalerallee 61, 65760 Eschborn, Germany, registered with the Commercial Register of the District Court in Frankfurt am Main, Germany, under number HRB 7500.