The Finnish CSD’s services are fully TARGET2-Securities (T2S) compliant, which is expected to attract new global clients to the Finnish market.
T2S will certainly be one of the key enablers for a more harmonized European securities settlement landscape. With the Finnish market’s T2S roadmap, we are now well positioned to serve our clients. During the next coming years, we will focus on developing more value-added services to our clients, with a specific focus on, for example, data services.
Good base for further development
As Infinity’s greatest benefit for the client, Puttonen sees the single CSD system with a standardized message interface. Furthermore, with harmonized corporate actions processing, the step towards TARGET2-Securities (T2S) becomes easier. Migrating services and messages that have been in use already for years reduces the risks related to this large market change.
“Euroclear has a solid base for further development of new services or mandatory upgrades. However, maybe the most significant benefit for us is that we can look for different ways of utilizing the huge amount of data we have in the system, and introducing new asset classes to the Finnish market. Although T2S readiness is the key, we are already looking beyond it, with a view of attracting new client groups and the best ways of utilizing our connection to the joint European platform”, Puttonen explains.
Having gone through the demanding multi-year journey, the company now has a better understanding of its clients’ operations and processes, and what kind of impact changes will have on them.
Harmonisation with Eurosystem Collateral Management system
ECMS is a system for managing assets used as collateral in Eurosystem credit operations, and its planned launch is in November 2023. It will replace the current systems of 19 national central banks, including ours. In practice, it will ensure that cash, securities and collateral flow freely across Europe. In this development, we are one of the key players, as a central security depository will manage the securities flow.
“We want to ensure that our services are fully ECMS compliant for our current clients and of course to our prospective clients. It is very important that the securities in the Finnish market are collateral eligible, to be able to meet the requirements from both local and global clients.”
It all started in 2013
The journey started in 2013, after the Finnish market made a strategic decision to join T2S. The replacement of a full CSD solution was unique in Europe, and a tremendous effort for the whole market.
The legacy systems were changed in two phases: in 2015 for the fixed income market and in 2018 for the equity market, when almost 1.5 million accounts were migrated during one weekend. All the process changes and message interface changes required development work with the clients as well, so this was a joint effort between all parties.
“We are very happy that the migrations were successful, although the timetable was delayed, because we underestimated the required time for harmonization. On the other hand, there was a valid reason for the postponements. Our key objective has always been production stability, and it is now on a very good level”, says Puttonen.
Best in class client service
People and interaction is at the core. Despite of how shamelessly good the IT solution is, is still all about people and communication.
“When we think beyond the IT development project, it’s about client communication, testing, documentation, training, monitoring and managing. Sometimes in the middle of all this, you just have to stop running, and concentrate on the most important issue. And lastly, formulate a clear message and keep communicating it, internally and externally to serve your clients in the best possible way”, Puttonen concludes.