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TARGET2-Securities (T2S) initiative

TARGET2-Securities is a European platform for the harmonised and centralised settlement of securities in central bank money. It is also one of Europe’s largest infrastructure projects

However, we believe T2S is more than "just" a settlement platform – it represents a fundamental reshaping of European capital markets. More than this – it presents benefits and opportunities for savings for all those involved in dealing with securities.


Regulatory constraints and the resulting capital, funding and cost pressures that subsequently result continue to force banks to re-engineer their business models. While trading and clearing operations are being actively restructured, banks are missing out on untapped optimisation opportunities in the post-trade area, particularly in the highly fragmented European market.

The European Central Bank’s TARGET2-Securities (T2S) initiative is addressing this fragmentation. T2S will trigger fundamental changes in the post-trade landscape, far beyond the initial scope of pan-European settlement in central bank money. These changes will enable cost efficiencies which banks must consider to support their cost saving agendas and stay competitive with other market players. T2S will enable banks to reap significant benefits from consolidating assets and from direct access to and use of central bank money.

These efficiencies play an important role in unleashing the wider macroeconomic benefits from integrating European securities markets, building on the creation of the joint interbank payment system TARGET2.

Institutions that delay a proactive T2S strategy risk being hindered by their current providers and losing their competitive edge as savings accrue to first-movers. Banks should act now – or they risk missing out on the T2S opportunity.

T2S offers multiple benefits that banks can unlock by consolidating their securities and cash holdings in Europe directly on central securities deposititories (CSDs) and central banks, thereby allowing them to:

  • reduce settlement-related exposures,
  • pool collateral for settlement and triparty purposes,
  • net more cash settlements, and
  • simplify operations.

Time line

T2S started operations in June 2015. Since then, participating CSDs have been migrating to T2S in multiple major on-boarding phases (“waves”). This process was completed in February 2017.

T2S: the highlighted parts of the value chain are affected

Clearstream: TARGET2-Securities


By consolidating all T2S-eligible assets at Clearstream, the largest T2S participant, customers benefit from unique economies of scale and netting opportunities. Full CSD and ICSD triparty interoperability will enable improved liquidity and collateral management.

Liquidity Alliance provides worldwide collateral access to T2S

TARGET2-Securities has been going live in waves since 2015. While this process is being completed, Liquidity Alliance members are benefiting from access to the future pan-European liquidity pool T2S will create. Streamlined settlement will integrate respective assets for smooth collateral management activities.

LuxCSD: T2S initiative

LuxCSD has been created within the context of the implementation of the Eurosystem's TARGET2 Securities (T2S) initiative. T2S will bring a single integrated process across Europe for DVP settlement in central bank money.