T2S Project status and way forward. IT NUG Milan, 14 th July 2015

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1 T2S Project status and way forward IT NUG Milan, 14 th July 2015

2 1. Project status 2. T2S defects status 3. MT Community Testing status London Stock Exchange Group 15 July 2015 Page 2

3 1. Project status London Stock Exchange Group Page 3

4 Report from T2S CSG - 2 nd July Approved plan for MT go-live on 31 August: 1) MIG2 restarted to operate with Live Timing on 06/07 and will continue until 14/08, after that will return to Synchronised Standard day until end of testing period (21/08) 2) Migration weekend Dress reharsal is planned for 01 and 02 August, preceded by the usual preparation activities. 3) T2S regular software releases will continue until 24/07, after this date, only prod defects will be deployed or blocking issues identified in the meantime as part of the Community or Business Day test. 4) Defined a list of defects (baseline) to be solved for MT go-live Works of the ad-hoc task force still on-going to evaluate impacts on other waves London Stock Exchange Group Page 4

5 Plan for MT go-live on 31 August London Stock Exchange Group Page 5

6 Report from ABI/ASSOSIM meeting 3 rd July MWEDR on 1-2 August: 1) Agreed participation of intermediaries (communication already sent) 2) No possibility to copy production data in the test environment (clarified by 4CB) but committment by alll actors involved to re-create the same conditions of migration weekend 3) Analysis on-going with 4CB to simulate a business day on Monday (volumes to be considered Descoping of functionalities 1) Confirmed descoping of CAoF standards management for OTC tx and cash forecasting 2) Organised a meeting on 7 July to define operational management of CAoF on pending tx 3) MT to send market notice to clarify descoping areas and that no detection will be executed for OTC tx from go-live to date tbd (expected by end of week) Portfolio transfer 1) Confirmed management of 3 decimals for Deal Price 2) MT to send list of ICP using RNI message switching (for the issue on using / as separator) 3) Workaround proposed by participants (query to detect PORT with 5 decimals and report to ICPs) not feasible because of operational burden Hold/Release 1) Meeting with interested parties already planned (Wednesday, 15 July) to agree on the solution Matching ICP/DCP 1) Confirmed adoption of workaround for go-live (DCP to set Party 2 either blank or with a unilateral BIC code assigned to Client) 2) MT to verify DCPs static data set-up and contact bilaterally, if required London Stock Exchange Group Page 6

7 Report from PT-TUG Settlement Optimisation - 7 July Agreed actions 1 Problema semt.027 (PBI156444): MT sta intraprendendo tutte le attività necessarie per risolvere la criticità e riferirà nel corso del NUG-IT del 14 luglio Outcome Il PBI risulta come hotfix con data risoluzione 24/7 2 Predisposizione di una tabella riepilogativa di tutti i problemi attualmente presenti sulla piattaforma e loro monitoraggio in funzione delle future release La lista dei defects (T2S) prioritari per il Go Live, che sarà sempre in progress, sarà proposta nel NUG del 14/07 3 CAoF OTC: L unica attività amministrativa svolta da Monte Titoli per l OTC è la cancellazione delle istruzioni pending per le operazioni di Aumento di Capitale a pagamento, Inoptati e per tutti gli eventi societari in cui il titolo scade (es. redemption) in cui almeno una delle controparti è un ICP Si allega la tabella Elenco processi amministrativi.xlsx con l elenco degli eventi societari per i quali sono generate istruzioni CAoF Transformation ed è prevista la cancellazione, indicando altresì le casisistiche per cui l attività sarà eseguita automaticamente o manualmente. 4 Integrare tabella pag. 5, specificare campo rif. Msg mittente e proporre una soluzione alternativa per il campo nr. Oper. Spec Si allega il documento T2S incontro ABI 7lug15 upd pptx con gli aggiornamenti richiesti. 5 si prevede di generare un messaggio 7B2 like per le CAoF on Exchange generate con procedura amministrativa In allegato si fornisce il template 7B2 like.xlsx del file Excel che sarà utilizzato per la segnalazione delle CAoF generate con procedura amministrativa. 6 Confermare e documentare la cancellazione automatica della underline Cfr #4 transaction alla maturity date 7 Confermare e documentare la procedura di riattivazione dello stesso ISIN per Il processo è descritto negli use cases delle CAOF e nelle slides del PT-TUG diritti di opzione per l asta dei diritti inoptati 8 Predisporre un prospetto riepilogativo dei processi (automatici / Cfr #3 amministrativi) che Monte Titoli utilizzerà per le varie tipologie di eventi societari ed evidenziare eventuali differenze di gestione per i DCP e ICP. Sul punto Monte Titoli riferisce dell attività amministrativa di cancellazione delle istruzioni pending alla maturity date, e che sarà predisposto l elenco degli eventi societari impattati 9 Predisporre degli esempi di messaggi generati automaticamente e in via amministrativa a fronte della medesima istruzione CAoF, al fine di confrontare nel dettaglio i campi utilizzati dai partecipanti. Si allega il documento Sample CAOF AMM VS ORIG 2.xlsx London Stock Exchange Group 14 July 2015 Page 7

8 Self assessment report summary Area G Y R n/a X NO DATA Totale OVERALL PROGRESS DOMESTIC SETTLEMENT (OTC) DOMESTIC SETTLEMENT (ONEX) CrOSS BORDER SETTLEMENT - Cross-CSDs CROSS BORDER SETTLEMENT - External CUSTODY ON STOCK - Reorganisation CUSTODY ON STOCK - Cash Distribution CUSTODY ON FLOW COLLATERAL - MT management COLLATERAL - T2S management CASH INTEROPERABILITY CASH AUTHORISATION - DCP only CONTINGENCY SCENARIOS Stato Attività G Y R X n/a NO DATA Definizione Attività in linea con la pianificazione e la data di migrazione Attività in ritardo rispetto alla pianificazione ma senza impatti sulla migrazione Attività in ritardo che (in assenza di misure correttive) può avere impatti sulla migrazione Attività non ancora iniziata Non applicabile (funzionalità non utilizzate) Campo non valorizzato London Stock Exchange Group 15 July 2015 Page 8

9 2. T2S defects status London Stock Exchange Group Page 9

10 Status of important T2S defects TICKET NUMBER SUMMARY SEVERITY SUBMIT DATE STATUS FOLLOW UP PBI Settlement Restrictions linked WITH together did not settle together 2-Urgent 01/12/2014 In Progress Confirmed post go-live. Workaround available in PROD. INC Error DSU1042 when removing a closed restriction from an ISIN. 24/06/2015 In Progress Planned for the 24/7 release INC MIG2 - Same settled transaction is reported in two delta semt.017s 4-Low 30/06/2015 In Progress INC PBI MIG2-4 missing sese.025s due to internal sequencing not completed Outbound messages screen not reachable when clicking on Related Outbound Messages button in the Settlement Instruction Details screen 2-Urgent 06/07/2015 In Progress 3-Medium 15/05/2015 Resolved Customer Follow-Up Required PBI MIG2 - CSD user cannot transfer DCA to a different account holder due to an unknown error 3-Medium 15/05/2015 Resolved Customer Follow-Up Required PBI (MT-1472) Incoherence into the ReturnLimit answer sent from T2S 3-Medium 10/06/2015 Resolved Customer Follow-Up Required PBI Object Privileges (cross system entity) not shown in GUI 3-Medium 15/06/2015 Pending Future Enhancement PBI T2S Multilateral: Additional parties incorrectly displayed on T2S GUI 2-Urgent 18/06/2015 Pending Pending Original Problem PBI Pending instruction not present in semt.027 response from T2S MIG2 2-Urgent 19/06/2015 In Progress Planned for the 24/7 release PBI MIG2 - GUI visualisation issue 4-Low 23/06/2015 Pending Future Enhancement PBI semt.018 wrongly including SttlmSts and InstrPrcgSts 2-Urgent 18/05/2015 Pending Waiting Internal Enhancement INC MT-2492 Missing T2S sese.024 for our instructions 3-Medium 08/07/2015 Assigned INC No remaining amount shown in statement of pending instructions - Jira MT-2478 Intesa Sanpaolo. 2-Urgent 03/07/2015 Pending Client Action Required London Stock Exchange Group 14 July 2015 Page 10

11 3. MT Community Testing status London Stock Exchange Group 15 July 2015 Page 11

12 Settlement STATUS OWNER Issue /comment RESOLUTION DATE MARKET opening/resending/closing POST TRADE PRE-SETTLEMENT/SETTLEMENT (not guaranteed trades) POST TRADE PRE-SETTLEMENT/SETTLEMENT (guaranteed trades) Bilateral netting (net and gross margin model) ROUTING ICSD (Bilateral balance Creating TLN) and original trade for EuroMOT ECB - Autocollateralization: process almost tested. Solution identified for issue messages sequencing received from the T2S platform Counterparty Hold: Analysis performed and solution identified. Terms presented to DB and the other participants during last PT-TUG. Ad hoc meeting to be organized in the next days. Party 2: workaround starting from 31/8 MT verification on bilateral basis static data where it could be possible a mis-matching when Party 2 field is populated. Ongoing. See above Release on 17/7 TBD CCP flows Portfolio Transfer PCT/PCR Cash Forecast As per agreement in PT-TUG: character allows in all transmission channels ( - instead of / ): MT will send ABI list of participants who used RNI Messages Switching. Decimals: value 3 bytes, percentage 5 bytes confirmed. MT will send all participants the info on the limitation Note: PCR under testing (even if out of scope for the lunch of the service) Descoped. Administrative solution presented during PT-TUG (template and standard query)

13 Cross and External CSD Settlement STATUS OWNER Issue RESOLUTION DATE CROSS CSD SETTLEMENT Reporting/Input/Allegment/Cancellation/ Matching/Forwarding to Settlement System Process/Reporting EXTERNAL CSD SETTLEMENT Reporting/Input/Allegment/Cancellation/ Matching/Forwarding to Settlement System Process/Reporting Partial Settlement on UK market Incoming and outgoing messages for the whole process work properly MT - giri dump (Spain and USA) Issues on outgoing messages have been fixed. Analysis done on issue raised on incoming messages TBD Dual listing: released and currently under testing

14 Corporate Actions on Flow (CAOF) STATUS OWNER Issue RESOLUTION DATE OTC descoped (management presented during PT- TUG) On Exchange: Tested with positive result: Dividendi (in cash e in natura) Pagamento interessi Rimborso (totale) Under testing: Reorganization (gratuite, a pagamento, mandatory) Missing semt.027 related to semt.026 sent ECB: INC closed since it is linked to PBI that is the summary of the CAOF messages incidents raised. TBD Market claim rejected by X-TRM if Party2 not present in X-TRM (DCP failed transactions) MT CR (ADDITIONAL MANAGMENT OF THIS SPECIFICITIES) Party 2: w/a starting from 31/8 MT verification on bilateral basis static data where it could be possible a mis-matching when Party 2 field is populated. Cfr. Matching Criteria in T2S document Market claim rejected by X-TRM-Securities account of the counterparty missing MT CR (REMOVE OF CONTROL AND INSERT OF THE BIC OF THE COUNTERPARTY IN X-TRM) WORKAROUND SUGGESTED BY MT Cfr. Matching Criteria in T2S document

15 Custody and Corporate Action STATUS OWNER Issue RESOLUTION DATE Admission of Financial Instruments Issuance / Mark up Mark Down Cash Distribution - MT Issuer Reorganization MT Issuer No issues No issues No issues No issues No major issues Cash Distribution - MT Investor Reorganization MT Investor No major issues Minor regression on reorganization with options will be fixed and relevant test will be performed again next week Government Bond - Auction No issues PBI Cash Payment Tests on Govies were successfully performed, both for interest and redemption payments. There are still some issues related to link after.. Concerning the book-out of securities positions due to redemption, an issue generated by the creation of balances caused a delay in the settlement of relevant instructions. PBI_ INC_ PBI_ INC_ Coupon Stripping No issues

16 Thanks for the attention! London Stock Exchange Group Page

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