Corporate Action Harmonisation - Changes to EUR payment flows for subscription rights and manual cash bookings
Clearstream Banking1 informs customers that with the launch of the TARGET2/T2S consolidation project effective
20 March 2023
EUR payment flows for subscription rights on the German market will be enhanced and processed via T2S DCA (Dedicated Cash Account).
With the implementation of the German model for corporate action cash payments in June 2020, cash payments in EUR for CBF-issued securities were generally moved from TARGET2 (T2) to the TARGET2-Securities (T2S) platform.
For certain processes and payment scenarios, this transition was not entirely completed in June 2020 and subsequent enhancements in November 2021.
That is, the debit of subscription right payments and manual cash bookings, if any, were continued to be processed via T2/RTGS accounts.
Impact on customers and agent banks
With the launch of the TARGET2/T2S consolidation project effective 20 March 2023 (customers should refer to Announcement D20027 and previous announcements), all EUR payment related processes will use the T2S DCA (Dedicated Cash Account).
For customers and agent banks, this means that:
- There is no change for payments already processed via T2S;
- The debit of the subscription costs (regular subscription and oversubscription), will now be done via PfoD from the customer DCA which is linked to the related customer CBF account;
- The credit of subscription costs will now be done to the agent bank DCA which is linked to the related agent bank CBF account;
- There is no change in the debit/credit of instructed subscription rights; and
- Manual cash bookings, if any, will now be processed via T2S.
Standard PfoD processing and reporting will be followed.
This change was originally foreseen and communicated as part of the KADI DE Migration to OneClearstream Asset Servicing (OneCAS) scope. Due to the postponement of this project, the changes will now come into effect with the TARGET2/T2S consolidation project.
For further information, customers may contact OneClearstream@clearstream.com, Clearstream Banking Client Services or their Relationship Officer.
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.