Interconnection with T2S TARGET2 Interconnection with T2S

Overview The need to adapt TARGET2 to T2S System to system connection Mandatory amendments to core services Value added services Interactions between the banks and TARGET2 / T2S

TARGET2 adaptations to T2S The need to adapt TARGET2 to T2S The intensive discussions between the Eurosystem, the 3CB and the banks lead to the following conclusion: The connection of T2S to TARGET2 will be considered and built as a new interface specially designed for T2S The same technical interface (with the same message standard) should be used for the management of both T2 cash accounts and T2S Dedicated Cash Accounts There is a need of monitoring and consolidating liquidity posted in T2 accounts and T2S Dedicated Cash Accounts in real time Shifts of liquidity (Liquidity Transfers – LT) in both directions (from T2 to T2S and T2S to T2) to be made available Data consistency between both systems to be ensured (i.e. for reference data)

Overview The need to adapt TARGET2 to T2S System to system connection Mandatory amendments to core services Value added services Interactions between the banks and TARGET2 / T2S

TARGET2 adaptations to T2S System to system connection Use of ISO 20022 compliant standard including Business Application Header Creation of a dedicated T2S interface in TARGET2 Management of liquidity transfers in both directions T 2 S I RTGS RTGS DCA Securities ISO 20022 RTGS DCA Securities

Overview The need to adapt TARGET2 to T2S System to system connection Mandatory amendments to core services Value added services Interactions between the banks and TARGET2 / T2S

TARGET2 adaptations to T2S Mandatory amendments to core services Implementation of camt5 (without Business Application Header) (camt5 is the only valid standard for T2S related A2A customer interaction in T2) Development of new messages (in addition to proprietary messages) In release 5.0 (Nov 2011) In release 7.0 (Nov 2013) CAMT 3 CAMT 3 Only for non-T2S related business CAMT 4 CAMT 4 CAMT 5 For T2S and non-T2S related business 7

TARGET2 adaptations to T2S Mandatory amendments to core services Event-oriented standing orders for liquidity transfers from TARGET2 to T2S (setting up via U2A and A2A) Optional debit notifications in MX (camt.054) Credit notifications in MX (camt.050) Current order for liquidity transfers from TARGET2 to T2S via U2A or A2A (camt. 050) Bank Standing/current order liquidity transfer (U2A or A2A camt5) Credit notifications optional debit notifications (camt5) RTGS RTGS DCA Securities ISO 20022 RTGS RTGS DCA Securities

Overview The need to adapt TARGET2 to T2S System to system connection Mandatory amendments to core services Value added services Interactions between the banks and TARGET2 / T2S

TARGET2 adaptations to T2S Value added services Some TARGET2 participants may not be ready by the time T2S goes live to properly interact with T2S Several optional services are proposed by the Eurosystem to manage their cash across TARGET2 and T2S But These optional services will be developed only if TARGET2 participants confirm their needs on the basis of the pricing that will be decided. A tentative pricing will be announced towards the end of the year. 10

TARGET2 adaptations to T2S Value added services Intraday balance of DCA (=> cash integration) in U2A / A2A (camt.003) Liquidity transfers from TARGET2 to T2S via MT202 Liquidity transfer from T2S to TARGET2 via MT202, U2A or A2A (camt.050) Credit notifications via MT202 and optional debit notifications via MT900 DCA end of day statements (MT940/MT950 or camt.053 without BAH) Access to T2S GUI via the ICM (to be confirmed) Bank Liquidity transfer (MT202) Liquidity transfer (U2A/A2A camt5) Access to T2S GUI via the ICM DCA intraday balance (U2A/A2A camt5) Optional debit notifications (MT900) Credit notifications (MT202) DCA end of day statement (MT940/MT950 or camt5 without BAH) RTGS RTGS DCA Securities ISO 20022 RTGS RTGS DCA Securities Cash related information flows

Overview The need to adapt TARGET2 to T2S System to system connection Mandatory amendments to core services Value added services Interactions between the banks and TARGET2 / T2S

TARGET2 adaptations to T2S Interactions between the banks and TARGET2 / T2S Eurosystem’s offer for TARGET2 (cash side) ISO20022 compliant interface Access to RTGS related features via TARGET2 using a new ISO20022 compliant interface. Access to DCA related features via the regular T2S ISO20022 compliant interface. Standard offer Legacy standards Conversion by TARGET2 ISO20022 Central Bank Money DCA RTGS Converted by TARGET2 Optional offer Access to the main DCA features via TARGET2: Intraday balance on the DCA Liquidity shift (push and pull) End of day statement for the DCA Eased access to the T2S GUI for other features Alternative interface (legacy standards)

TARGET2 adaptations to T2S Interactions between the banks and TARGET2 / T2S CSD ISO ISO U2A/camt5/MT RTGS RTGS DCA Securities ISO RTGS RTGS DCA Securities Securities related information flows Cash related information flows