Adopting New Market Standards

The T2S National Users Group Slovakia (NUG-SK) was established with UniCredit Bank as one of its founding members. The Slovak CSD CDCP set an adaptation plan and identified the areas concerned by T2S. The schedule, the business adaptation plan and the legal analysis have been shared with market community.

Key decisions taken by CDCP with regards to T2S

• Slovakia's market specific operations do not allow CDCP to fully replace the legacy system with T2S
• A layered model in account mapping will be used
• CDCP will use its own matching component and send intra-CSD matching instructions to T2S, CDCP’s internal IT system will use additional complementary matching fields along with the mandatory T2S fields to comply with legal requirements, cross- CSD and DCP instructions will be unaffected since they will be matched in T2S
• CDCP will implement new GUI and A2A interfaces for participants, based on ISO20022 messages, complemented with proprietary elements / messages for the local market's needs, CDCP will not provide conversion for ISO15022 messages
• CDCP will provide a DCP option date only at a later stage, the however such date has not yet been defined

In 2014, CDCP signed a contract to adjust its information systems for the migration to T2S. Important changes (new GUI, A2A and backend modules) were delivered to CDCP’s testing environment in April 2015, where internal testing was carried out. The VAN network contract with SWIFT was signed in May 2015 and from 15 July 2015 CDCP was registered into the T2S EAC testing environment. Bilateral testing with T2S in GUI mode started on 28 July 2015 and will continue. In November 2015, CDCP added bilateral testing with T2S in A2A regime. The results of CDCP's internal acceptance testing of the core modules indicate that the CSD is ready to start user testing with T2S.

CDCP will comply with the T2S schedule of settlement day and irrevocability of transfer orders on the date of migration. Bilateral cancellation of instructions will be introduced after achieving a matched status. On the date of migration to T2S CDCP will comply with the irrevocability of bookings on CSD accounts. New operational processes implemented in the internal IT system will respect the unconditional, irrevocable and enforceable nature of the settlements processed in T2S. CDCP does not intend to exchange registration details using T2S messages, neither does it plan to include tax-related information.

CDCP plans to implement the following new functionalities as instruction processing:

• allegements
• hold and release mechanism
• uniform rules for cancellation of instructions
• recycling rules

UniCredit GSS does expect other major changes that will impact clients.

In Q1 2016, CDCP finished its bilateral T2S testing and distributed the test result certificates to its members and then proceeded with user training. Prior to their involvement with the testing, community testing will start in August 2016. CDCP intends to finish soon the update of its operational rules and the fee schedule in accordance with T2S.