The depositaries have engaged in extensive market consultation and dialogue with national regulators and will finalise assessment of CSD outsourcing arrangements with relevant regulators before signing the T2S Framework Agreement. With support from parent company Euroclear SA/NV, the Boards of the three CSDs have agreed for each CSD to sign the T2S agreement.
As a result, Euroclear Belgium, Euroclear France and Euroclear Nederland will outsource settlement transaction processing to T2S. Clients of the three CSDs will continue to have accounts directly with the respective CSD and receive the full range of post-trade services from that CSD. The migration date and fees for connecting to and using T2S will be determined after completion of market consultation.
Joël Mérère, chairman of the Boards of Euroclear Belgium, Euroclear France and Euroclear Nederland, explains that: "The three Euroclear group central securities depositories are reflecting local market sentiment by taking the decision to sign the T2S Framework Agreement. As the first and only group of markets in continental Europe to have consolidated and harmonised transaction settlement and custody services on a shared platform, we appreciate the benefits of large-scale processing consolidation and harmonisation that T2S has the capacity to provide."
Valérie Urbain, chief executive officer of Euroclear Belgium, Euroclear France and Euroclear Nederland, add: "Euroclear has been preparing to operate within a T2S environment for some time. Our asset servicing capabilities are expanding, and we are introducing collateral management services for clients in the Belgian, French and Dutch markets, as well as with some local central banks. The depth and breadth of the domestic and cross-border post-trade services we offer will clearly help clients get the most out of the new operating environment in the easiest way possible."
Euroclear Belgium, Euroclear France and Euroclear Nederland claim to be the first and only group of central securities depositories in continental Europe that process client transactions on a shared platform and operate with harmonised market rules and practices. Known as the ESES (Euroclear Settlement of Euronextzone Securities) platform, the three CSDs settled EUR 87 trillion of securities transactions in 2011, representing 31 million transactions, and held approximately EUR 6 trillion of assets for clients.
The three ESES CSDs are part of the Euroclear group, which includes the international central securities depository Euroclear Bank, based in Brussels, as well as the national central securities depositories Euroclear Finland, Euroclear Sweden and Euroclear UK & Ireland. Euroclear also owns Xtrakter, operator of the TRAX trade matching and reporting system.
In 2011, the Euroclear group settled more than EU 580trn in securities transactions, representing 163m domestic and cross-border transactions, and held more than EUR22trn of assets for clients. Euroclear Bank is rated AA+ by Fitch Ratings and AA by Standard & Poor’s.