While the move to T2S is ushering in greater efficiencies to the settlement process, new regulation governing central securities depositories (CSDs) raises significant considerations for broker dealers and global custodians, says Richard Willsher.
T2S was introduced to reduce the cost and inefficiencies of securities settlement within the eurozone. CSDs now outsource their settlement function to the T2S platform. T2S harmonises aspects of settlement, improves its timing and introduces common functions across the region. This in turn fosters competition and reduces the cost of inward investment into the Eurozone. In particular, greater efficiencies were introduced to larger securities market participants who can now hold their own accounts directly with a foreign CSD, while smaller players may still need to appoint a local custodian.
The full article is available here: http://gtb.db.com/insights-and-initiatives/flow/CSDs_redefined.htm