T2S?? What's that?
T2S or Target 2 Securities, is basically a totally new way of organising of the European settlement infrastructure. Traditionally each country has it's own settlement infrastructure. Cross border settlement is difficult and unreliable. T2S will change all of that.
Back in 2001 it became clear that the European market infra needed change. The Lamfalussy report, commissioned by the European commission, for the first time clearly stated the risks and the threats associated with the European infrastructure.
14 years later the first step into harmonisation has been taken. In different waves most EU CSDs will have moved to T2S by may 2017. So, are we done then? No, as always there is a typical European exception: the UK. Apart from the UK there are also some smaller markets that are not included in the project. Strangely enough the Swiss are in.
Still, if the need to re-align positions between France, Germany and Italy disappears then the gain is enormous: less cross border settlements, smarter use of cash, less buy ins, less risk, etc.