yves mersch : introductory statement on target2 - securities ( t2s ) before the committee on economic and monetary affairs ( econ ) speech by mr yves mersch, member of the executive board of the european central bank, at the public hearing on target2 - securities ( t2s ) before the committee on economic and monetary affairs ( econ ) of the european parliament, brussels, 16 june 2015. * * * mr chairman, dear members of the committee on economic and monetary affairs, ladies and gentlemen, i am glad to be here today to discuss target2 - securities, or t2s – the new securities settlement engine in europe. the european parliament has played an essential role in this project and strongly supported it from the beginning. we are only three days away from the first migration weekend, during which the first european markets will migrate their securities settlement business to the platform. t2s will be live as of 22 june. over the next two years it will come more and more into life as a total of 21 markets migrate to the new single platform. t2s is the largest market infrastructure project undertaken by the eurosytem to date. i would today like to emphasise the progress we have achieved on our journey from target in 1999 to t2s today, and how this provides a good example for further integration in the context of the capital markets union. target in 1999, with the launch of the euro, there was an immediate need for a large - value payment system that could process all payment flows related to monetary policy operations in euro. target was launched on 1 january after only four years of development. owing to the time constraints, it was not possible to develop a fully integrated system, but only to link the existing systems in europe. in order to build a truly integrated system, the target2 project was initiated and target2 started operations in 2007. today it is one of the largest payment systems in the world, reaching around 56, 000 banks worldwide, in addition to the central banks of the eu. in 2014 over 90 million payments were settled, with a turnover of €492 trillion. the use of target2 is mandatory for the settlement of all payment orders related to monetary policy operations in euro, and is therefore an essential component of our monetary policy execution. it has enabled us to create a single money market for the euro area, as all euro cash payments are settled in a streamlined way across europe. target2 is used for payments related to both monetary policy

##isation agenda, csd regulation and capital markets union let me now turn to the other initiatives surrounding t2s, namely the harmonisation agenda, the csd regulation and the capital markets union project. in addition to the concrete benefits brought about by t2s, a push has been given to the european post - trade industry to harmonise market practice, rules and standards. this is a market - driven process that will enable t2s to realise its full potential, in terms of efficiency and achieving a level playing field. the market is in the driving seat, but the ecb strongly supports this initiative and provides the secretariat function. the objective is to create a single rulebook for post - trade processes, which will help contribute to financial integration in europe. on the regulatory side, remarkable progress has also been made with the adoption of the csd regulation. this new piece of eu legislation complements the operational integration provided by t2s and gives further momentum to the post - trade harmonisation efforts. it has removed a number of the barriers to reaching a fully integrated market and is thus very much welcome. the next step forward will be the capital markets union ( cmu ), for which we have high expectations. if well designed and thoroughly implemented, cmu could bring significant benefits to the eu. t2s and the implementation of the csd regulation have already removed a number of the market infrastructure barriers. cmu has the potential to remove the remaining ones. beyond market infrastructures, the aim of cmu should be to integrate financial markets in such a way that investors and issuers of financial instruments have equal access to these markets, under equal conditions. similarly to the harmonisation agenda surrounding the development of t2s, cmu will require both market - led efforts towards greater harmonisation and legislative action to dismantle key cross - border barriers in a wide range of areas. this will help set the right framework conditions for these markets to develop and integrate. in fact, target2 and t2s show that genuine integration, rather than mere coordination, is essential to have well - functioning markets which can fully play their role in supporting the economy. thank you for your attention. i am now looking forward to our discussion. bis central bankers ’ speeches