4CB Governance: Towards a new integrated model. Focus Session Paris, 13 th December 2017

Transcription

1 4CB Governance: Towards a new integrated model Focus Session Paris, 13 th December 2017

2 Agenda I. The current 4CB organization for T2 and T2S II. What results so far? III. Reasons to change IV. What s new? V. The ECMS project 2

3 I. The current 4CB organization for T2 and T2S (cont d) T2S: 4 areas, 4 product managers, a matrix organisation Banque de France NPM Deutsche Bundesbank NPM Banca d Italia NPM Banco de España NPM BdF Coordination FAM BBK Coordination Modules Modules Modules Modules Modules OM LEA/LTSI BdI Coordination Collateral (liaison with CMSs) 3

4 I. The current 4CB organization for T2 and T2S (cont d) The same three layers governance structure for T2 and T2S Product Steering Committee (PSC T2/T2S) NCB Business Head (voting right) NCB Head of IT dept. NCB Product Managers NCB optional member 4CB Product Manager Rapporteur Chairmanship based on annual rotation Product Management Committee (PMC T2/T2S) Functional and Application Manager Operational Manager CMS Liaison Manager Head of product Management Office Further representative for each NCB 4CB Product Manager NCB Product Managers Chairmanship by Product Manager Product Management (T2/T2S) Functional and Application Management (T2/T2S) Operational Management (T2/T2S) Liaison with CMSs (T2S) Product Management organisation Functional and Application Management organisation Operational Management organisation Liaison with CMSs organisation 4

5 Agenda I. The current 4CB organization for T2 and T2S II. What results so far? III. Reasons to change IV. What s new? V. The ECMS project 5

6 II. What results so far? Target 2 Securities 4CB delivered on time, in June 2015, one of the most complex platform ever built in the world of market infrastructures; Thanks to the combined efforts of ECB, 4CB, CSDs and NCBs the migration went smoothly along the five waves and the functioning of the platform is in line with expectations; In November 2017: Peak day (06/11) workload settlements (Value: 871 Billion euros). Average day: settled, Availability 100%, Settlement Efficiency (Value) 98%. 4CB organisation has proved its agile ability, capable of delivering several releases a year (with more than 600 CRs in total) during the migration period. 6

7 Target 2 II. What results so far? (cont d) T2 is smoothly running for more than 10 year In 2016: Has 100% availability ratio 92.8 Mio payments (3.3% increase compared to previous year) 892,155 Bio. overall value (9.22% increase compared to previous year) A platform in constant evolution (ex: support instant payment at the Target Ancillary System Interface in R11). 7

8 Agenda I. The current 4CB organization for T2 and T2S II. What results so far? III. Reasons to change IV. What s new? V. The ECMS project 8

9 III. And yet reasons to change Meet the challenges of Vision 2020 strategy : how to manage 2 products (T2 and T2S) with important evolutions (DKK,CSDR ) and three projects at the same time? Optimise cost for projects and operational phases Reap the full benefits of T2 and T2S experience Reduce the complexity of a cooperation with 4 partners 9

10 Agenda I. The current 4CB organization for T2 and T2S II. What results so far? III. Reasons to change IV. What s new? V. The ECMS project 10

11 Two portfolios IV. What s new? Portfolio 1 will comprise T2, T2S, TIPS and the consolidated T2/T2S (replacing T2 with CLM, RTGS and Shared Services). This portfolio will run on the Eurosystem Market Infrastructure Structure Platform (EMIP) managed by BBK and BDI. Portfolio 2 will comprise ECMS. This portfolio will run on the Eurosystem Shared Applications Platform (ESAP) managed by BDE and BDF. Where ever feasible it will use Shared Services in Portfolio 1. One 4CB Steering Board that will steer all 4CB activities and represent the 4CB towards the MIB and other relevant stakeholders One external advisor to the 4CB Board Two Central Managers for each portfolio (Operations and Evolution) who will have authority on the various national teams also on a cross-ncb basis One Cyber Resilience and Information Security Manager 11

12 IV. What s new? Q Setting up of 4CB Steering Board Appointement of Central Managers Draft mandate for 4CB advisor Annual rotation of 4CB representatives (starting with BDI) Q New 4CB agreement Detailed planning of projects 12

13 IV. What s new? The new Governance maintains the joint 4CB responsibility towards the Eurosystem over all products and projects that it manages. The two portfolios structure will : enable teams to be more specialized from a technical and functional point of view; create coherent software set, maximizing functional synergies for the benefit of users ; increase the global resilience of 4CB infrastructures with two platforms (EMIP and ESAP). 13

14 Agenda I. The current 4CB organization for T2 and T2S II. What results so far? III. Reasons to change IV. What s new? V. The ECMS project 14

15 V. ECMS project: Objectives and planning The ECMS project is a part of the European Market Infrastructure Vision, together with the T2/T2S Consolidation project and TARGET Instant Payment Settlement (TIPS) project. These projects share multiple dependencies from which synergies are expected to be materialised. ECMS Objectives ECMS aims at replacing 19 Eurosystem NCBs CMS bringing the following expected benefits : o o o cost savings as only one system will need to be tested, operated and maintained; improving operational efficiencies as the system will reduce manual intervention; contributing to the European Capital Markets Union (CMU) by reducing market fragmentation and allowing easy and efficient mobilisation of collateral to the Eurosystem both domestically and across borders. Planning Pre-project phase of ECMS launched by Eurosystem in 2015 ECMS is foreseen to go live one year after T2-T2S consolidation in nov 2022): Investgatio n 2018-Q Build Phase Q Acceptan ce testing Q Q User testing Nov Running phase

16 V. ECMS project: Functional scope ECMS shall encompass following functionnalities : Processing of marketable and nonmarketable eligible assets (according to the General Documentation); Settlement of monetary policy operations (liquidity providing and liquidity absorbing reverse transactions), and on-request marginal lending. Other credit facilities provided via central bank money, like intraday credit or automatic marginal lending are also supported by ECMS.

17 V. ECMS project: Interactions with external actors ECMS Service Desk Support, monitoring & necessary business validation System administration NCB Operators Collateral Instructions & Credit requests (marginal lending, fixe credit line, ) Counterparties Collateral & Credit Positions DECC Custodian Credit Claims eligibility and valuation Eligibility data Close Links Prices Ratings C2D/MPEC C2D/EA RIAD CEPH CAS Tender Allotments Systems TARGET2 TIPS Tender Results Connected / Regular payments Update Credit Line Standing facilities Monetary Policy Operations Interfaces Reference Data Global Credit & Collateral Collateral Management Interface to local NCB system (reference data, locally managed collateral, DWH, ) Triparty Instructions & reporting Eligible Assets, Prices Corporate Actions Asset data Settlement instructions Data providers Local NCB System Tri Party Agents (I)CSD/SSS Cash Correspondant Payments in foreign currency Reporting Reporting Support Functionalities General Ledger Autocollateralisation support (Eligible Assets, Prices Coefficient, Close Links) T2S Legal Reporting Authority C2D UC ODB NCB s Accounting System Emergency collateral; Euro collateral (de)mobilisation for foreign central bank Other NCBs 17

18 Interfaces V. ECMS project: Scope Exceptional Events Non Functional Requirements A2A U2A External system failure Counterparty bankruptcy Security Reference data management Reference Data Import of ref data from external sources Provision of ref data to external entities Monetary Policy Operations Open Market Operations (preparation of the payments) Standing Facilities Global Credit & Collateral Position Management Credit Outstanding Credit Position Credit Freezing Credit Line ELA value Margin Call Collateral Aggregated Collateral Value External Collateral Value Collateral Marketable Assets (incl. DECCs) Collateral Tri-Party Multi-pooling support Collateral Management (de)mobilisation Eligibility Close links Valuation Custody Corporate Actions T2S collateral relocation (autocollat) Transactions Reporting Collateral Credit Claims ACC Collateral Management Support Concentration limits Fixed Term Deposit Cash Collateral Registration (de)mobilisation Valuation Close links Custody Eligibility DECC support Ex-post checks ECMS MIB reporting Support Functionalities Monitoring Reporting Data Warehouse Archiving Billing Accounting 18

19 V. ECMS project: Harmonisation issue The harmonisation of processes was identified as a key success factor for ECMS project. An harmonisation workstream is under way since 2015 and has already delivered harmonised processes and workflows for most processes. ECMS UR delivered in august 2017 take on board those harmonisation proposals Some issues still being on going : Triparty management : a single model is expected; messaging in ISO20022 Corporate actions workflows and conversion of messages in ISO20022