ECB harmonizing settlement and collateral management systems

  • New projects facilitate integration of financial markets in Europe
  • New real-time gross settlement services will increase efficiency
  • Eurosystem-wide collateral management system will merge 19 national systems into a harmonized single platform

The Governing Council of the European Central Bank (ECB) approved the consolidation of the Eurosystem’s real-time gross settlement system TARGET2 and the securities settlement platform TARGET2-Securities (T2S), and the development of a Eurosystem Collateral Management System. Both projects will modernize existing systems and increase overall efficiency.

The TARGET2-T2S consolidation will provide market participants across the Eurosystem with enhanced liquidity management procedures. The consolidated system is expected to be launched in November 2021. This follows a public consultation in which market participants helped to define the user requirements.

The Eurosystem Collateral Management System (ECMS) will provide a harmonized platform for collateral operations across the Eurosystem and will replace the existing systems of the 19 national central banks for those functions which can be harmonized until the launch. The ECMS will allow changes to the existing collateral framework to be implemented in a harmonized way across the euro area. The launch is planned for November 2022. The Deutsche Bundesbank, the Banco de España, the Banque de France and the Banca d’Italia will act as service providers for both projects.

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