Disclosure report – TARGET2-Securities assessment against the principles for financial market infrastructures

The European Central Bank (ECB) published the first disclosure report of the TARGET2-Securities assessment against the principles for financial market infrastructures.
The disclosure report is based on a self-assessment against the Principles for Financial Market Infrastructures (PFMI) of the Committee on Payment and Market Infrastructures and the International Organisation of Securities Commissions (CPMI-IOSCO), the first comprehensive assessment since its go-live. The report reflects the T2S Operator’s view on the extent to which T2S meets the PFMI. T2S has regularly been enhanced through yearly technical and functional releases since its go-live in 2015, allowing identified gaps to be closed and the efficiency of the platform to be improved. The self-assessment was performed and assessed the status of PFMI compliance for 2018/2019.
To recall, TARGET2-Securities (T2S) is a settlement infrastructure owned by the Eurosystem that allows for the exchange of securities and cash on a delivery-versus-payment basis in central bank money. T2S currently has 21 central securities depositories (CSDs) from 20 European countries connected to the platform. The platform processed a total of 187,377,873 transactions in 2021 with a daily average of €691.10 billion. The management of T2S is based on a three-level governance scheme, and the main risks to which T2S is exposed are legal, liquidity, operational and information security, and general business risks. The T2S Operator applies the generic risk management frameworks of the Eurosystem, the European System of Central Banks (ESCB), and the Single Supervisory Mechanism (SSM). Detailed technical documentation and legal documentation are available on the websites of the ECB and the Eurosystem central banks.