The reform of European securities settlement systems : Towards an integrated financial market

The European Central Bank (ECB) will offer to banks in 2013 an european shared platform for securities settlement, named TARGET 2 Securities (T2S), in order to open the national financial markets. The financial crisis did not change the ECB agenda. This paper develops a spatial competition model to understand the impact of this new organisation on european post-trading services. We analyse the incentives of the Central Securities Depositaries (CSD) to move to T2S when they become competitors in the market for settlement services and remain in a monopoly position for depository services. Settlement and depository services are complementary goods, because banks have to pay for these two services to buy or sell a security. We show that such a reform should induce a decrease in the settlement price and more generally in post-trading prices, but that prices depend strongly on market organisation. Under certain conditions, partial adhesion would make prices increase. This configuration appears as a Nash equilibrium. As CSDs are free to adhere to T2S, the ECB might be forced to regulate.Post-trading organisation; securities settlement; depositary services; compatibility

The reform of European securities settlement systems : Towards an integrated financial market

Working paper du GATE 2011-29The European Central Bank (ECB) will offer to banks in 2013 an european shared platform for securities settlement, named TARGET 2 Securities (T2S), in order to open the national financial markets. The financial crisis did not change the ECB agenda. This paper develops a spatial competition model to understand the impact of this new organisation on european post-trading services. We analyse the incentives of the Central Securities Depositaries (CSD) to move to T2S when they become competitors in the market for settlement services and remain in a monopoly position for depository services. Settlement and depository services are complementary goods, because banks have to pay for these two services to buy or sell a security. We show that such a reform should induce a decrease in the settlement price and more generally in post-trading prices, but that prices depend strongly on market organisation. Under certain conditions, partial adhesion would make prices increase. This configuration appears as a Nash equilibrium. As CSDs are free to adhere to T2S, the ECB might be forced to regulate

Les enjeux du rattachement des monnaies du Maghreb à l'euro

National audienc

Les enjeux du rattachement des monnaies du Maghreb à l'euro

National audienc

La compétition euro/dollar au Liban : analyse prospective à la lumière des modèles de compétition technologique

National audienc

Attaques spéculatives et crédibilité du régime de change. Quel arbitrage pour le policy-mix ?

Since the Asian and Brazilian exchange rate crises have occurred, the reaction of authorities has been the subject of an intense debate. Indeed, coping with a speculative attack, domestic authorities both increase interest rates and contract fiscal policy. It appears that such a combination of policy instruments is counterproductive. This paper analyses the credibility of the policy-mix used by authorities. But, opposite to traditional credibility models, fiscal policy is explicitly introduced in the loss function of the authorities. The model suggests that a restrictive fiscal policy is not necessary a credible decision to defence the exchange rate target. Classification JEL : E5 ; E6 ; F4

The impact of the settlement platform T2S on the European financial markets

Présenté par Nadège Marchan