Eurobonds eligibility in T2S - Phase 2 - Update
Note: This announcement, originally published on 25 June 2020 and updated on 22 September 2020, has been further updated to inform customers that the date of the second phase for the eligibility of Eurobonds for settlement in CBF-T2S has now been added. The changes have been highlighted.
Clearstream Banking AG1 would like to inform customers that effective as of
22 March 2021
it is pleased to announce the second phase for the eligibility of Eurobonds for settlement in CBF-T2S, in order to further extend the high-quality post trade suite of services offered by OneClearstream as a single gateway to all TARGET2-Securities (T2S) and global markets and to offer customers the key benefits as described below:
- Unlock T2S benefits with liquidity pooling on a single Dedicated Cash Account (DCA) and therefore capital savings.
- Offer a choice of money quality to customers between central bank money (via CBF) and commercial bank money (via CBL).
- Use Eurobonds for collateral purposes in T2S including monetary policy operations of the Eurosystem.
- Enable additional opportunities for balance sheet netting in central bank money.
- Extend counterparty reach by allowing CBF customers to reach Euroclear Bank counterparty.
Type of assets
Clearstream Banking extends its XS Eurobonds eligibility in T2S as of March 2021 in a second phase after having released the first ISINs in T2S in December 2019.
Phase 2 – As of 22 March 2021
The full asset scope of Phase 2 will encompass a high amount of approximately ~13 0002 Eurobonds ISINs that match the following conditions:
- ECB Collateral eligible.
- German Stock Exchange eligible3.
- Eurex CCP eligible3.
- Issued under NGN Euro-system form.
- Global bearer form and NSS.
- Currency is an ECB eligible currency.
- Issuer EEA + G104 (Qualifying Issuers).
The cutover for eligibility in T2S of the above asset scope will take place in two steps, based on the following criteria:
- Step 1 – 22 March 2021: ECB Collateral eligible, excluding German Stock Exchange eligible, excluding Eurex CCP eligible (~2,000 securities).
- Step 2 – 19 April 2021: ECB Collateral eligible (delta since 19 March 2021), German Stock Exchange eligible, Eurex CCP eligible (~11,000 securities).
As of 19 April 2021, Eurobonds corresponding to the following criteria will be considered for eligibility in T2S after issuance in CBL5:
- Issued under NGN Euro-system form.
- Global bearer form and NSS.
- Currency is an ECB eligible currency.
- Issuer EEA + G104 (Qualifying Issuers).
Settlement
In Phase 1, the following settlement flows were enabled for settlement of Eurobonds in T2S:
- CBF/CBF.
- CBF/CBL.
- CBF/LuxCSD.
In Phase 2, as of 22 March 2021, Clearstream Banking will additionally offer the following Eurobonds settlement links:
- CBF/Euroclear Bank.
Asset servicing
The selected Eurobonds will be processed according to OneClearstream asset servicing standards.
Safe custody type
Clearstream reminds customers that the ISINs that will become eligible in T2S will be flagged in WM with the sub-custody value “NCSC-T” represented by field GD400 = 60.
Current T2S-eligible Eurobonds
One Eurobond which is currently already T2S eligible remains CSC and will continue to be served by KADI:
- XS1071847245.
Further information
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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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.
2. Quantity may vary according to new issuances and/or redemptions until cutover.
3. At cutover.
4. EEA and G10: United States of America – Canada – Japan – Switzerland and supranational.
5. If matching the listed criteria, the eligibility will be attributed two business days after closing date (issuance date).