The European Banking Federation (EBF) welcomes the proposal published by the European Commission, aimed at establishing common rules for central securities depositories to operate in a safe and efficient manner.
The proposal also seeks to improve the timing and conduct of securities settlement in the European Union. Together with Target2-Securities (the single settlement platform to be operated by the European Central Bank), this regulation is a major achievement towards the integration and harmonisation of the highly-fragmented securities settlement environment that exists in Europe.
Central securities depositories (CSDs) are essential market infrastructures that banks use in their securities operations. The Commission proposal ensures that central settlement, central safekeeping, administration and registration services are done in a safe place and are the core functions of a CSD. As direct and indirect participants to these infrastructures, European banks therefore expect that CSDs have a low-risk profile as they are instrumental in the safety, stability and efficiency of financial markets.
The European Banking Federation believes that the regulation will contribute to clarifying the role of CSDs in European financial markets. Notwithstanding that, banks are conscious that the outsourcing of the settlement functions by the CSDs to Target2-Securities will have a strong impact on the business model of these infrastructures.
Press release
© EBF
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