the eurosystem continues to play an active role in the payment industry by providing – in the form of target2, which went live just last week on 19 november – borderless core infrastructure for real - time settlement in central bank money. 1 further support for the single market will come from the streamlining of collateral management systems through the ccbm2 ( collateral central bank management ) project. t2s will build on the newly released target2 system and bring payments associated with securities settlement together with pure cash settlements across the european union. the lisbon agenda clearly demonstrates that not only must europe do better, it can do better. we can say that we want europe to be the best and most secure place to issue and trade securities and that we want it to be the most competitive economy in the world. however, europe lacks a common post - trade “ plumbing ” system, whereas the united states target2 went live on 19 november for the eight countries ( austria, cyprus, germany, latvia, lithuania, luxemburg, malta and slovenia ) in the first wave. created such a system years ago. t2s joins other european initiatives, such as the code of conduct and the markets in financial instruments directive ( mifid ), in helping to fulfil the objectives set out by the lisbon agenda for the provision of better services to issuers and investors. we firmly believe that t2s will speed up market integration and foster competition. the t2s settlement system will act as a driver to promote harmonisation within the european securities industry, creating opportunities for cost savings and allowing market participants to select and choose post - trade partners irrespective of their location within the single market. the impact of t2s on harmonisation is already being felt, building on valuable work by the csds. the icsds ’ experience in bringing together several national csds has created valuable impetus in this respect. the next speaker will also contribute to this debate by highlighting the advantages of such harmonisation. the eurosystem, inter alia through the t2s project, will play a leading role in working with market participants to harmonise market practices at the european level for the benefit of those participants. this work is likely to remove even more barriers of the kind already identified by the giovannini group, as well as helping users to identify the irreducible costs of unresolved barriers in the new efficient borderless settlement environment. this work will also increase the pressure for swift action to harmon

##ise practices that do not constitute pure settlement activities, especially in relation to corporate activities, taxes, laws and regulations. t2s will harmonise the real - time life cycle management functionality for settlement instructions. t2s will also harmonise the settlement model and will offer daily real - time and night - time cycle modules. market participants will therefore follow one common set of harmonised settlement procedures irrespective of whether they are settling securities domestically or cross - border. t2s will provide a neutral, borderless, core infrastructure crystallising the gains from harmonisation and providing support for competition between service - providers in the posttrade industry for securities. this will foster the changes required in intermediation between issuers and investors by providing impetus for financial market participants ’ development of a competitive, efficient and secure european financial market. furthermore, t2s will also create a single pool of assets within europe, essentially all of the securities held by participating csds, exchangeable for each other via central bank money at low cost, in real time and in an extremely reliable settlement system. market participants across europe will therefore be able to pool all of their securities in one system, just as cash is now pooled in target2, without the need to distribute and allocate securities and central bank money within several independent national platforms. this will increase the efficiency of collateral management and reduce market participants ’ collateral and / or liquidity needs. t2s will therefore have the effect of reducing market participants ’ costs and contributing to the optimal allocation of investment opportunities. this will also allow for the faster re - use of securities, as well as central bank money – again, for the benefit of market participants. the use of target2 and t2s will eliminate the risk currently associated with cross border settlement, thereby providing for efficient and stable intermediation between buyers and sellers within the capital market segments. these new features will therefore create valuable new options for commercial and investment banks as regards the management of their collateral and the optimisation of their funding costs. the indications given by market participants suggest that this is likely to lead to very significant reductions in costs. this will feed through to increased trading activity, reduced trading spreads and lower service prices, thus improving welfare. europe will benefit from t2s. commercial service - providers will benefit from the level playing - field that a common platform, harmonised rules and practices and reduced complexity will bring. issuers will benefit from lower capital costs. investors will