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Warsaw, 9 July 2018

KDPW’s communication on the opinion of the Polish market re. joining TARGET2-Securities

KDPW (The Central Securities Depository of Poland) has consulted members of the user group T2S NUG_PL and decided to reassess in 2020 the merits of joining TARGET2-Securities with PLN and EUR settlements. The future assessment will take into account the experience of the Danish market which is planning to migrate the Danish krone to T2S in October 2018.

KDPW in partnership with the National Bank of Poland hosted two meetings of T2S NUG_PL in H1 2018 in order to revisit the 2012 decision postponing the execution of the Master Agreement concerning participation in TARGET2-Securities (T2S) with EUR settlements.

KDPW has surveyed KDPW participants on the potential decision to join T2S with PLN and EUR settlements by 2023. Until that time, T2S should become stable following Eurosystem projects including the implementation of TIPS (2018), the consolidation of TARGET2-Securities and TARGET2 systems (2021), and the launch of the Eurosystem Collateral Management System (2022).
The survey identified limited benefits of T2S participation for the Polish market. In the opinion of market participants, despite a lower cost of cross-border settlements on T2S, they do not expect a major increase in trade of Polish investors active on markets served by T2S or foreign investors present in Poland. The main benefits of T2S relate to EUR owing to potential concentration of liquidity of settlements on many markets in a single cash account. The concern is that the cost of joining and using T2S for the Polish market will be incommensurately high compared to potential benefits in view of the high share of domestic settlements in PLN.

“KDPW’s cost and benefit analysis indicates a high risk of imbalance between high costs of migrating domestic settlements to T2S and additional revenue at the current stage of market development and in the nearest future, not least due to the expected increase of Eurosystem fees. KDPW is not planning to replace its settlement system within the next five years, which would be a good reason to join T2S,”
said Sławomir Panasiuk, Vice-President of the KDPW Management Board.

“KDPW understands the importance of T2S to the development of cross-border securities trade in the European Union. Consequently, KDPW is gradually preparing for participation in TARGET2-Securities, including harmonisation of the Polish market with European standards, irrespective of the date of execution of the Master Agreement,”
said Michał Stępniewski, Vice-President of the KDPW Management Board.


TARGET2-Securities (T2S) is a technology platform launched on 22 June 2015 to support centralised settlement of securities trade in EU Member States in central bank money. T2S settles domestic and cross-border transactions based on single rules, standards and costs for all trade. The mission of T2S is to facilitate and reduce the cost of cross-border settlement of securities transactions settled on the DVP basis (delivery vs. payment) in EUR and other currencies available on T2S.

The user group T2S NUG_PL was established in 2010. Headed by KDPW, it brought together Polish capital market players: custodian banks, brokers, the National Bank of Poland (NBP), the Polish Financial Supervision Authority (KNF), the Ministry of Finance, the Polish Bank Association (ZBP), the Warsaw Stock Exchange (GPW) and BondSpot. In partnership with user groups in other countries, T2S NUG-PL contributed to the decision concerning the scope of participation of the Polish market in T2S in 2012, after which the group was suspended. It was re-established in 2017.


Last modified: 11-07-2018 Go up