T2S wave 4: Impact on LuxCSD services – cutover details (43xxx accounts)
Effective
Monday 6 February 2017
the fourth wave of TARGET2-Securities (T2S) will be launched.
For Austria (OeKB), Germany (CBF), Hungary (KELER), Slovak Republic (CDCP) and Slovenia (KDD), please find below the cutover details for the handling of pending transactions for LuxCSD customers.
Please refer to Announcement L16133, dated 28 November 2016 for instruction specifications.
Austria
Matched and unmatched instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later released to OeKB
All T2S eligible transactions that are in matched or unmatched status and that have been released to OeKB by 15:45 CET on Friday 3 February 2017 will be migrated to T2S by OeKB.
No action is required from LuxCSD customers.
Pending instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later not released to OeKB
Pending T2S eligible transactions in an unmatched status, but not yet released to Erste Group Bank AG by 15:00 CET on Friday 3 February 2017, will be stored by CBL and released to Erste Group Bank AG and subsequently to T2S only after confirmation of the successful migration of OeKB to T2S.
Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays.
The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from Erste Group Bank AG.
Settlement cut off time
In order to facilitate the start of the migration process on 3 February 2017, OeKB has shortened the end of day cut off deadline. LuxCSD customer deadlines on Friday 3 February 2017 are as follows:
Against payment in EUR: 14:55 CET instead of 15:35 CET.
Free of payment: 14:55 CET instead of 17:35 CET.
Note: Settlement deadlines against payment in foreign currencies (CHF, GBP, USD) remain unchanged and are as follows:
Against payment: 13:55 SD-1.
Income and custody events
Market claims and Transformations
For any income payments or corporate action events with Record Date before, on or after 3 February 2017, payments will be booked and executed on Pay Date.
Any matched and entitled, but not yet settled instruction, will be migrated to T2S by Erste Group Bank AG and managed according to the new T2S market claims and transformation rules.
Germany
Matched and unmatched instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later released to CBF
All T2S eligible transactions that are in matched or unmatched status and that have been released to CBF by 17:30 CET on Friday 3 February 2017 will be migrated to T2S by CBF.
No action is required from LuxCSD customers.
Pending instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later not released to CBF
Pending T2S eligible transactions in an unmatched status, but not yet released to CBF by 17:30 CET on Friday 3 February 2017, will be stored by CBL and released to CBF and subsequently to T2S only after confirmation of the successful migration of CBF to T2S.
Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays.
The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from CBF.
Settlement cut off time
There is no change to the current LuxCSD settlement deadlines for CBF eligible securities on Friday 3 February 2017 and they remain as follows:
Against payment in EUR: 15:40 CET
Free of payment: 17:40 CET
Note: Settlement deadlines against payment in foreign currencies (CHF, GBP, USD) remain unchanged and are as follows:
Against payment: 17:10 SD.
Reminder: Customers are reminded to use only BIC 11 DAKVDEFFXXX to identify CBF as Place of Settlement in T2S and not DAKVDEFFDOM, which is not a valid T2S Party BIC11 of CBF in T2S. Otherwise, LuxCSD customer instructions will be rejected by T2S.
Income and custody events
Market claims and Transformations
For instructions resulting out of a corporate action event (Corporate Actions on flow and stock) with a record date prior to 3 February 2017, CBF will cancel all instructions that are pending on 3 February close of business.
LuxCSD customers are requested to liaise with their counterparty to compensate the proceeds of market claims or transformations bilaterally or to instruct the claim as of Monday 6 February 2017.
For instructions resulting out of a non-income event (corporate actions on flow and stock) with a record date equal or after 3 February 2017, market claims and transformations will be generated with the new T2S rules with payment date 6 February 2017 or later.
Hungary
KELER will migrate to T2S during the migration weekend, but will implement its replacement system (BaNCS) including all T2S functionalities only after migration has taken place. According to current plans, the go-live of the new system will be 3 July 2017.
Impact on customers
Settlement against EUR is not offered by LuxCSD to customers today. All FoP instructions will settle via KELER as today, but outside T2S, with the exception of cross-border deliveries to OeKB counterparties.
Hence customers are not impacted by the migration of KELER to T2S and domestic Hungarian instructions will settle without any change.
Slovak Republic
Matched and unmatched instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later released to CDCP
All T2S eligible transactions that are in matched status and that have been released to CDCP by 13:00 CET on Friday 3 February 2017 will be migrated to T2S by CDCP.
Unmatched instructions will not be migrated to T2S, but will be cancelled by LuxCSD at close of business on Friday after 12:45. Customers are requested to re-instruct in the correct T2S format after successful migration of CDCP has taken place.
Pending instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later not released to CDCP
Pending T2S eligible transactions in an unmatched status, but not yet released to CSOB by 12:45 CET on Friday 3 February 2017, will be stored by CBL and released to CSOB and subsequently to T2S only after confirmation of the successful migration of CDCP to T2S.
Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays.
The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from CSOB.
Settlement cut off time
In order to facilitate the start of the migration process on 3 February 2017, CDCP has shortened the end of day cut off deadline. LuxCSD customer deadlines on 3 February 2017 are as follows:
Against payment in EUR: 12:40 CET instead of 14:25 CET
Free of payment: 12:40 CET instead of 15:55 CET
Income and custody events
There is no impact on income events (interest or dividend) on CDCP eligible securities. Furthermore, no impact is expected on corporate action events over the migration weekend.
Slovenia
Matched and unmatched instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later released to KDD
All pending T2S eligible transactions that are in matched or unmatched status and that have been released to KDD by 16:15 CET on Friday 3 February 2017 will be removed by NLB from the KDD system and will be submitted again to KDD after successful migration has taken place.
No action is required from LuxCSD customers.
Pending instructions with requested settlement date (SD) up to and including 3 February 2017 and SD 6 February 2017 or later not released to KDD
Pending T2S eligible transactions in an unmatched status, but not yet released to NLB by 15:45 CET on Friday 3 February 2017, will be stored by CBL and released to NLB and subsequently to T2S only after confirmation of the successful migration of KDD to T2S.
Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays
The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from NLB.
Settlement cut off time
In order to facilitate the start of the migration process on 3 February 2017, KDD has shortened the end of day cut off deadline. LuxCSD customer deadlines on 3 February 2017 are as follows:
Against payment in EUR: 15:35 CET (no change).
Free of payment: 15:40 CET instead of 16:55 CET.
Income and custody events
There is no impact on income events (interest or dividend) on KDD eligible securities. Furthermore, no impact is expected on corporate events over the migration weekend.
Matching note: Post migration, LuxCSD customers are recommended to use the additional matching fields opt-out and cum/ex indicators only if it is ensured that their counterparty indicates the same opt-out and cum/ex indicator at instruction level. Otherwise, the instructions will not match. If no agreement with the counterparty is in place on the usage of the opt-out and cum/ex indicators, we recommend that they are left blank in order to avoid matching issues.
Further information
For further information, customers may contact Client Services or their Relationship Officer.