Euroclear Finland – Implementation of Infinity Release 2

18.12.2017

Clearstream Banking AG, Frankfurt1, provides a preliminary information on the implementation of Euroclear Finland’s Infinity Release 2 scheduled on

Monday, 12 February 2018.

Since 2013, CBF has maintained a link to Euroclear Finland (EFI) via Clearstream Banking S.A., Luxembourg (CBL). CBL acts as technical issuer CSD and has a direct link operated by Nordea Bank, Finland. CBF customer instructions are routed via the CBF-CBL interoperability link to the Finnish market.

Background

With the implementation of the Infinity Release 2, EFI will deliver key elements for the migration to T2S. From 12 February 2018, settlement instructions need to be compliant with the T2S matching criteria.

Customer Readiness

The impact assessment conducted by the T2S Customer Readiness Team shows that no modifications in the link between CBF and CBL will be necessary for the implementation of the Infinity Release 2. Today’s interoperability link using the depository account “4496 CBF W/CBL-AUSLAENDISCHE WERTE” will remain unchanged.

Clearstream’s existing International Market Link Guide2 which describes the setup for realignments, free of payment (FoP) and delivery versus payment (DvP) instructions will be slightly updated. The market deadline for the transmission of instruction will be modified according to specification provided by EFI:

Instruction type

Currency

Provisioning Start / End3

Deadline

Free of payment (RFoP and DFoP)

Not applicable

19:30 on SD-1 / 18:00 on SD4

17:45 on SD

Against payment (RvP and DvP)

Euro in Central Bank Money

19:30 on SD-1 / 16:00 on SD

15:35 on SD

Against payment (RvP and DvP)

non-
T2S Currencies

19:30 on SD-1 / 16:00 on SD

15:35 on SD

Please be informed that today’s account numbers will be updated by EFI for processing with Infinity Release 2.0. CBF customer should contact their counterparties in the Finnish market to check, if the existing standing instructions may need to be changed.

In general, the securities settlement processing executed by EFI will be compliant with T2S. Customers can setup their instructions as designed for CBF’s migration with T2S Wave 4.
However, there are a few deviations.

  • The “Opt-Out” and “Cum/Ex” indicators are processed by EFI for matching purposes. Similar to T2S, these fields belong to the category “additional” matching fields. The further processing is based on the rules in the market. For the time being, CBF recommends that customers agree with their counterparties on the settlement procedure for the relevant trades before using the qualifiers “Opt-Out” and “Cum/Ex”.
  • Partial settlement functionality will not be supported until EFI migrated to T2S. Even though an instruction is routed with the partial settlement flag to EFI, EFI will ignore the flag; meaning no partial settlement will be executed.

Transition approach

EFI shared a first deployment plan for the implementation of the Infinity Release 2.0 with CBL. The cutover procedure may require the cancellation of pending instructions. The cancellation will be required on Friday, 9 February 2018. Customers should be prepared to provide their cancellation requests towards CBF during the course of this day. CBF will inform customers in due time.

Next steps

CBL started to conduct a similar analysis for its direct link to Nordea Bank and will announce the relevant modifications in the beginning of 2018.

Once Euroclear Finland confirms its migration to TARGET2-Securities (T2S), CBF will inform its customers about the respective migration procedures and associated timeline. The latest reporting shows that the transition is envisaged in 2019.

Contact

The T2S Support team can be contacted for questions regarding the implementation of Infinity Release 2.

Please note that after the successful transition period our Client Services teams will be responsible for any questions of the customers pertaining to production processes.

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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. More details can be found on Clearstream’s web portal. Please use the following link.

3. All times are Central European Time (CET).

4. SD stands for Settlement Day.