OneClearstream migration to Belgium (NBB) – customer impact
As previously communicated in Clearstream Banking’s1 Announcement A17129, Clearstream Banking S.A. (CBL) will amend its settlement flow and appoint Clearstream Banking AG (CBF) as its single gateway to the T2S Settlement platform. This will lead to the migration of NBB T2S-eligible securities to CBF on
22 October 2018
This announcement provides an overview of the generic migration principles together with their preparation activities. Dedicated cutover announcements will be published around two months prior to the market migration date to provide further information concerning market migration timings and the securities to be migrated. They will also explain the rules applicable to distinguish securities that are being migrated from those that will remain with the current agent or depository.
Migration impacts on customers
The centralisation of T2S-eligible securities in CBF will be performed on dedicated migration weekends. As the transfer of security positions needs to take place during regular T2S business hours, the migration activities will start on a Thursday morning.
Customer preparation before the migration weekend
In order to ensure a smooth migration, customers are requested to cancel any remaining matched pending domestic settlement instructions in cooperation with their counterparties prior to the migration weekend, the specific deadline will be provided in the detailed cutover announcement. Since matching is binding in T2S, Clearstream Banking cannot cancel matched instructions unilaterally and will therefore take no action on these instructions. Clearstream Banking will initiate realignments to CBF for any positions that might result from cancellation of delivery instructions or settlement of receipt instructions. These realignments will be handled on a “best efforts” basis and delays in settlement of subsequent instructions with CBF cannot be entirely avoided. Clearstream Banking strongly encourages customers to cancel as many matched instructions as possible prior to the migration to limit the occurrence of these incidents.
An Instruction Pre-Matching service is offered, where Clearstream Banking releases domestic settlement instructions irrespective of the formal provisioning period and without provision check for pre-matching. In order to reduce the number of matched instructions at the time of migration in the domestic market to a minimum, Clearstream Banking will suspend this pre-matching service one week before the migration weekend. The re-activation of the Instruction Pre-Matching service is scheduled for Friday evening of the week following the migration weekend. Customers shall be aware that domestic settlement instructions sent for pre-matching purposes only (marked with value PREA in field :23G:) will not be forwarded to the current agent/depository while the Instruction Pre-Matching service is suspended. The Immediate Release Flag2 service, that triggers immediate provisioning and submission of the instruction to the domestic market, will be available for exceptional use while the Instruction Pre-Matching service is disabled.
Customers are requested to advise their counterparties about a change in settlement instruction formats as from the migration date. The instruction format for settlement instructions will not change for CBL customers, but it will change for their counterparties: the PSET will become DAKVDEFFXXX while DEAG/REAG remains unchanged to be CEDELULLXXX.
Procedures for domestic counterparties
Customers are requested to inform their local counterparties to use the following details for instructions that settle against Clearstream Banking
Settlement party details of CBL | Migrated securities | Non-migrated securities |
Place of settlement (PSET) | DAKVDEFFXXX | NBBEBEBB216 |
Delivering/Receiving Agent (:95P::DEAG/REAG) | CEDELULLXXX | CEDELULLXXX |
:97A::SAFE of the DEAG/REAG a | Not to be instructed. If instructed, it must be the valid CBL SAC NBB: DAKV7201107 | Not to be instructed. If instructed, it must be the valid CBL SAC NBB: NBBE100803011096 |
Buyer/Seller (BUYR/SELL) | BIC11 of the CBL customer | BIC11 of the CBL customer |
a. Although the safekeeping account of Party 1 (REAG/DEAG) is an optional matching field in T2S, if it is present on one instruction only it will only match with instructions instructed by this account.
As CBL does not forward its own SAC to the settlement parties, if the customer counterparty instructs the SAFE of REAG/DEAG it must match CBL's SAC in T2S exactly.
We encourage customers to ask their counterparties not to include the SAFE of the DEAG/REAG in their instructions (also called securities account of the delivering/receiving party).
Securities with an ongoing corporate action event (income and non-income) will be excluded from the original transfer date if the key date (that is, record date and/or deadline date) is around the migration date. These securities remain with KBC, until they will be migrated in one consolidated second migration that will happen no more than 20 T2S business days later. Customers will be informed two weeks prior to the initial migration weekend about the impacted securities. The final list will be provided on the Thursday before the migration weekend.
The place of safekeeping allocated to the transferred holdings will remain unchanged in the MT535 reporting.
In addition to the market migration, CBF intends to extend the scope of securities admitted to Collective Safe Custody. The admission into CSC will have an impact on trade processing for the German Stock Exchange activity on 6-series accounts (CBFi). Clearstream will publish further details with regard to timing and impacted securities in due course.
Handling of domestic settlement instructions during the migration weekend
On the Friday afternoon Clearstream Banking will stop sending domestic settlement instructions to KBC at a specific time to be communicated to customers in the dedicated market cutover announcements. This will not stop pending matched instructions to settle in the domestic market while CBL performs its cutover activities.
Pending unmatched domestic settlement instructions that have already been submitted to the market will be cancelled by Clearstream Banking. These cancellations will be visible to customers in Xact Web Portal, CreationOnline and in MT548 / MT537 reporting (if subscribed to).
New domestic settlement instructions received after the cut-off deadline (to be further announced), will be sent to the new depository CBF in the course of the migration and may match and settle on a “best efforts” basis. Pending unmatched instructions that have been cancelled by Clearstream Banking can be resubmitted by customers immediately after the receipt of the cancellation.
Further information
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.
2. How to use the immediate release flag:
SWIFT: value CEDE/IREL is inserted in field :22F: in the mandatory sequence E with qualifier STCO
CreationOnline: the Immediate Release flag is ticked
Xact Web Portal: the settlement transaction cond. is set to IREL – Immediate release