A year after pioneering into a Target 2-Securities (T2S) compliant platform, Denmark’s VP Securities is recording its best settlement and on-time rates ever. Morten Skanning and Henrik Høj from the company gave their picture at the PostTrade 360 Helsinki conference.
Overall settlement rates are currently 97.5 percent on the T2S platform, while marginally higher for the remaining operations on the older VP platform: 97.6 percent. The level of timely batch execution was 100 percent.
On stage in Helsinki on the Thursday, VP Securities’ senior product manager Morten Skanning and senior relationship manager Henrik Høj chose to look forward. Step by step, participants should be able to experience a cleaner cut between platforms and improving possibilities of harmonising with T2S standards. And with omnibus accounts, various improvements to services should become available.
Slow revolution expected
The landscape for central securities depositories, CSDs, is set for a gradual but far-reaching transformation towards open competition across the EU. This is a stark contrast to their long histories as national monopolies with a standing similar to public authorities. In reality, the hurdles to switching CSD’s are high for their clients, and many doubt that there can be true commercial competition in the short term. Even so, CSDs across Europe and the world are evidently reevaluating their long-term strategies.
“Our T2S experience has very much changed our mindset. We now ask ourself how we could create value for customers across the Nordic region, so they need to do things only in one place,” says Morten Skanning on stage.
Platforms in parallell
The implementation of T2S with VP Securities does not mean that its 3 million accounts will move to the new platform in a big bang.
”Individual accounts will stay with the VP platform for the time being. We will use the transfer functionality as we go forward,” says Henrik Høj.
During the previous day at the conference, Finland’s CSD Euroclear announced that it will migrate to T2S in three years time. Also, Heikko Kukko of Nordnet Finland, provided a survey-based analysis of the settlement performance in the different Nordic countries.