BNY Mellon CSD to become part of T2S infrastructure

BNY Mellon CSD SA/NV has signed a framework agreement with the Eurosystem that will allow it to outsource settlement to the Target 2 Securities settlement platform that is due to go live in 2015.

T2S was initiated as long ago as 2006 and is still under development, with Italian central securities depository Monte Titoli set to be among the first wave to adopt it two years from now. The key objective of T2S is to harmonise the fragmented securities settlement market in Europe. Its aim is to reduce costs in cross-border settlements and to increase client choice is European securities settlement.

T2S will also offer real-time delivery-versus-payment in central bank money across all involved European markets. The UK and Switzerland have chosen not to involve themselves in the project.

Jean-Michel Godeffroy, chairman of the T2S Board, said: "We are glad to welcome BNY Mellon CSD into the T2S Community. The fundamental objective of T2S is to contribute to making Europe a better place to invest. T2S is an open system that will allow all CSDs, whether established or newly-created, to find and exploit new business opportunities."

Incorporated in Belgium as a non-bank subsidiary of The Bank of New York Mellon and regulated by the National Bank of Belgium, BNY Mellon CSD SA/NV will offer issuer, settlement and safekeeping services for all market participants across Europe and the wider global marketplace. It will now work with the Eurosystem to implement the required IT infrastructure and connectivity to become a part of T2S.

Chris Prior-Willeard, CEO of BNY Mellon CSD SA/NV, said: "The creation of our CSD, and our commitment to the T2S project, demonstrates our ambition to support the aims and objectives of the new regulatory environment for financial markets in Europe, which we are confident will offer clear benefits to our clients. In becoming a participant CSD in T2S, we will be able to enhance our clients' experience; reduce risk by offering access to central bank money; and further enhance our ability to support our business activities across Europe."

Tim Keaney, CEO of Investment Services at BNY Mellon, said: "We are committed to occupying a position at the centre of the emerging European market infrastructure. T2S is a game changer for the industry, fundamentally altering how participants interact with the European market infrastructure. As a result, it will impact the business model of those participants, including CSDs, sub-custodians, global custodians and multi-direct clearers."

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