Leading the way to market infrastructure integration: the Market Infrastructure Board

March 2017

The Eurosystem is committed to increasing financial market integration in Europe and constantly strives to guarantee the safe and efficient functioning of its market infrastructure. The latest migration wave in February 2017 consolidated the success of the TARGET2 Securities (T2S) platform, the pan-European platform for securities settlement that now serves 16 European markets. The success of the project would not have been possible without the remarkable work and continuous guidance of the Market Infrastructure Board (MIB). The MIB is the management body in charge of Eurosystem initiatives in the field of market infrastructure. It is tasked with the day-to-day operation of TARGET2 and T2S, as well as the management of all Eurosystem projects in the area of market infrastructure and payments.

At the beginning of 2017 four members left the MIB. They have been part of an exciting journey where much has happened in the European post-trade industry. The journey will continue in the years to come, where further developments will shape the market infrastructure of tomorrow. We would like to thank the members who are leaving the Board and welcome our newly appointed colleagues. To mark the occasion, we spoke to Pierre Beck, outgoing Vice Chairperson and one of the pioneers of the T2S project, who shared with us his view on the key milestones in his long-standing experience as a member of the Board.

Mr Beck, you have been with the Board since its launch in 2009 and have witnessed and contributed to important changes in the field of market infrastructure in Europe. What would you say have been the key achievements for you during this time?

The last ten years have been a period of huge transformation in the post-trade sector. T2S as an idea started well before the setting-up of the governance of the project itself. Over the years I have indeed been privileged to witness the profound change in the way securities will be settled in Europe in the future.

This change was made possible thanks to the willingness of the central banks (CBs), central securities depositories (CSDs) and the banking sector to embark on a vast infrastructure project, comprising a common technical platform which interconnects all the CSDs and CBs of the euro area (and beyond).

It required public and private sector actors to come to a common understanding concerning a variety of aspects as diverging as functional (and non-functional) requirements, operations, governance, commercial interests, financing, pricing and so on and so forth.

As regards the central banks, a governance structure had to be put in place that adequately represents both those CBs that were entrusted with the building and operating of the system and the CBs that use the system either as customers of the CSDs or as settlement agents.

As for the private sector, CSDs and banks also had to come to a common view concerning the future functioning of post-trade processes. This dialogue led to a harmonisation process which goes far beyond the pure mechanics of settlement.

Besides the technical accomplishment that is the central system itself and the network of connected systems, which is undoubtedly a major achievement, I see the key achievement of the T2S project as lying in the multi-layered, multi-faceted dialogue that took place in numerous meetings, documents, emails and teleconferences, which I hope will benefit the industry in the future beyond the obvious advantage of having this technical infrastructure in place.

We would like to say goodbye and thank you to outgoing members Pierre Beck, Michalis Michalopoulos, Jesús López Pedruelo and Emerico Antonio Zautzik for their valuable contribution to the work of the MIB. We are also glad to welcome on board Stefan Augustin, Carlos Conesa, Marius Jurgilas and Paolo Marullo Reedtz and wish them the best of luck for the challenges ahead!