T2S Wave 4: Settlement of Finnish securities with Euroclear Finland

24.01.2017

Clearstream Banking AG, Frankfurt1 would like to inform customers that Finnish securities will be supported via the CBL link into Euroclear Finland only, starting from

Monday, 6 February 2017

From this time, the relayed link to Euroclear Finland via CBL as T2S Out-CSD will no longer be supported.

Background

CBF was informed on 9 September 2016 that Euroclear Finland would not be able to bring their new system "Infinity Release 2“ into production, which was scheduled for November 2016. Hence, the planned relayed link between CBF and Euroclear Finland via CBL as T2S Out-CSD cannot be introduced as planned. Euroclear Finland is investigating alternative delivery dates for their system "Infinity Release 2“. As a consequence, Euroclear Finland will not be able to migrate to TARGET2-Securities (T2S) on the current date scheduled on 18 September 2017, as published in the customer announcement M17001 on 12 January 2017.

Implementation approach

The link between CBF and CBL as T2S Out-CSD and the link between CBL and Euroclear Finland will still be supported as today. With the migration of CBF to T2S in Wave 4, cross-border settlement of Finnish securities will be possible with CBL participants only, until Euroclear Finland migrates to T2S. As a consequence, CBF customers cannot use the UEB-GRUND 221 (“EOC FIN Transfer“) to enter the Euroclear Finland counterparty. A validation is added to reject instructions with UEB-GRUND 221. Instead, CBF customers can still settle Finnish securities, via the following two steps:

  • In step one, customers have to transfer Finnish securities between Euroclear Finland and CBL via 6-series accounts in Creation.
  • In another step, customers have to realign the Finnish securities between 6-series accounts in Creation and CASCADE (link between CBF and CBL as T2S Out-CSD).

The two-step approach can already be used today.

Instruction management

After the migration, CBF customers will have to flag their cross-border instructions with UEB-GRUND 220 (“CBL Non-CSD Transfer”) and define their 6-series account in Creation as counterpart account for the transfer of Finnish securities. The mirror account 4496 (“CBF W/ CBL AUSLAENDISCHE WERTE”, T2S Party BIC “CEDELULLCPI”) will be required as today.
Customers will have to inform their counterparty in Euroclear Finland, to instruct against the 6-Series account in CBL for the transfer between CBL and Euroclear Finland.

Further instruction details in CBL apply as specified in the Creation Link Guide – Finland.

Migration information

The two-step approach will be implemented during the Migration Weekend of Wave 4.

Therefore, CBF customers and their counterparties in Euroclear Finland are advised to cancel all pending cross-border instructions before Friday, 3 February 2017 at 15:30 . If any pending cross-border instructions remain in CASCADE after this time, the same process will apply as for all pending cross-border instructions, that is CBF will cancel these instructions. A reporting of the cancelled instructions will be available via the CBF migration reporting. Please refer to the latest version of the CBF Migration Guide for further information for the Migration Weekend.

New cross-border instructions for Finnish securities can be entered for the CBF account master 4496 (same account as today) after the migration of Wave 4. Details on the timing during the Migration Weekend will be published in the Migration Guidelines for Customers, scheduled for 27 January 2017. Customers have to consider that from this date, only UEB-GRUND 220 is possible for cross-border instructions for Finnish securities.

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1. This Announcement is published by Clearstream Banking AG (CBF), registered office at Mergenthalerallee 61, 65760 Eschborn, Germany, registered with the Commercial Register of the District Court in Frankfurt am Main, Germany, under number HRB 7500.

2. CBF recommends to start latest at 10:30 on that day, in order to finish the cancellations in time.