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NOSAUKUMS
The Payment System : Payments, Securities and Derivatives, and the Role of the Eurosystem / Tom Kokkola.
IZDEVĒJS/GADS
Frankfurt am Main
European Central Bank 2010
APJOMS
369 p.
CITI AUTORI
Kokkola, Tom ed.
ISBN
9789289906326
UDK INDEKSS
336.717
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Anotācija
CONTENTS ABBREVIATIONS 13 FOREWORD ACKNOWLEDGEMENTS INTRODUCTION PART 1 KEY CONCEPTS IN MARKET INFRASTRUCTURE Chapter 1 Key concepts – payments 1 General aspects 1.1 Payments and the payment system 1.2 Life cycle of a payment 1.3 Types of payment 1.4 Payment instruments 1.5 Trends in the use of payment instruments 1.6 Communication networks 2 Processing (including clearing) of payments 2.1 In-house handling of payments 2.2 Correspondent banking arrangements 2.3 Payment systems (interbank funds transfer systems) 3 Settlement 3.1 Settlement assets 3.2 Settlement institutions 3.3 Settlement methods 4 Selected key issues in payment systems 4.1 Types of payment system 4.2 Card payment systems 4.3 Offshore systems 5 Cross-border and cross-currency payments 5.1 Issues in cross-border payments 5.2 Foreign exchange transactions and payment-versus-payment arrangements Chapter 2 Key concepts – securities 1 General aspects 1.1 The securities market 1.2 Functions and institutions in the securities industry 1.3 Issuance and central securities depositories 1.4 Holding structures and the custody industry 4 2 Trading 2.1 Trading venues and parties 2.2 Trade confirmation and matching 3 Clearing 3.1 General concept 3.2 Central counterparty clearing 3.3 Main risks and risk management procedures of CCPs 3.4 CCP interoperability and links 4 Settlement 4.1 Settlement dates and intervals 4.2 Delivery versus payment 4.3 Interaction between securities and cash settlement systems 4.4 Embedded payment systems 4.5 Banking services facilitating securities settlement 5 Cross-border handling of securities 5.1 Use of custodians 5.2 Links between CSDs Chapter 3 Key concepts – derivatives 1 General aspects 1.1 The derivatives market 1.2 Main types of derivative 1.3 The size of the OTC market 1.4 A stylised life cycle of a derivatives contract 2 Trading and post-trade services 2.1 Stylised evolution of products and trading modalities 2.2 On-exchange trading 2.3 Over-the-counter trading 2.4 Trade repositories 2.5 Assignment 3 Clearing 3.1 Bilateral clearing 3.2 CCP clearing 3.3 Portfolio compression 3.4 Recent initiatives 4 Settlement 4.1 Derivatives settled in cash 4.2 Derivatives settled physically 5 Chapter 4 Key concepts – risks 1 Introduction 2 Credit risk 2.1 Credit risk in payment systems 2.2 Foreign exchange settlement risk 2.3 Settlement agent risk 2.4 Credit risk in securities settlement systems 2.5 Custody risk 2.6 Risks in internalised securities settlement 2.7 Risks related to central counterparties 3 Liquidity risk 3.1 Liquidity risk in payment systems 3.2 Liquidity risk in securities settlement systems 4 Operational risk 4.1 General considerations 4.2 Operational risk management and business continuity 4.3 Operational risk management in payment, clearing and settlement systems 5 Legal risk 5.1 Legal risk in payment systems 5.2 Legal risks in securities settlement systems 6 Systemic risk 6.1 Systemic risk in payment systems 6.2 Role of critical participants in payment, clearing and settlement systems 6.3 Interdependencies of systemic relevance in the global financial market Chapter 5 The most relevant economic concepts in the field of market infrastructure services 1 Network effects and externalities 2 Economies of scale and scope 3 Natural and quasi-monopolies 4 Moral hazard 5 Cost recovery and pricing, and public goods 6 Two-sided markets 6 Chapter 6 Some key legal concepts in market infrastructure services 1 A sound legal basis 2 3 4 5 6 7 Chapter 7 The role of central banks 1 Introduction 2 Rationale for central bank involvement 2.1 Historical reasons 2.2 Links with monetary policy and financial stability 2.3 Addressing potential failures by infrastructures 3 Potential roles of central banks 3.1 Objectives and roles of a central bank 3.2 The central bank as operator 3.3 The central bank as oversight authority 3.4 The central bank as catalyst 4 Trends affecting the role of the central bank 4.1 Innovation and technological progress 4.2 Interdependencies 4.3 Delocation 4.4 Concentration PART 2 THE EURO AREA LANDSCAPE FOR PAYMENTS, SECURITIES AND DERIVATIVES Chapter 8 The payment market landscape in the euro area 1 Introduction 2 Payment instruments 2.1 Cash 2.2 Non-cash payment instruments 3 Large-value payment systems operating in euro 3.1 TARGET2 3.2 EURO1 3.3 Continuous Linked Settlement system 3.4 Other large-value systems operating in euro 7 4 Retail payment arrangements in euro 4.1 The Single Euro Payments Area project 4.2 Euro area-wide retail payment systems 4.3 National retail payment systems 4.4 Interoperability between retail payment systems 4.5 Card payment schemes 5 Correspondent banking arrangements Chapter 9 The securities and derivatives market landscape in the euro area 1 Introduction 2 Initiatives to increase the efficiency and safety of euro area (and EU) trading and post-trading services 3 Securities and derivatives trading in the euro area 3.1 Equities 3.2 Debt instruments 3.3 Derivatives 4 Central counterparty clearing in the euro area 4.1 An evolving landscape 4.2 Equities and debt instruments 4.3 Derivatives 5 Securities settlement infrastructure 5.1 CSDs and SSSs 5.2 Links and the cross-border settlement of collateral 6 Custody Chapter 10 Key legal acts of the European Union 1 Towards greater harmonisation and legal certainty 2 Areas and issues covered by existing legislation 3 Legal acts concerning payments, clearing and settlement 3.1 E-Money Directive 3.2 Regulation on cross-border payments in the Community 3.3 Regulation on information on the payer accompanying transfers of funds 3.4 Payment Services Directive 3.5 Settlement Finality Directive 3.6 Financial Collateral Directive 3.7 MiFID 3.8 Directive on the reorganisation and winding up of credit institutions 4 Legislative initiatives 8 PART 3 THE ROLE OF THE EUROSYSTEM Chapter 11 The Eurosystem’s operational role 1 Introduction 2 TARGET2 2.1 The backbone for the settlement of payments in euro 2.2 Historical background 2.3 TARGET2 properties 2.4 Liquidity and its management 2.5 Access and pricing 2.6 Operational risk management 2.7 Some figures 3 The correspondent central banking model 3.1 The euro area-wide use of collateral 3.2 The current model 3.3 CCBM2 – the next generation of Eurosystem collateral management 4 TARGET2-Securities 4.1 Integration of securities infrastructures 4.2 The basic concept of T2S 4.3 Major project milestones 4.4 Governance and organisation Chapter 12 The Eurosystem’s oversight role 1 Oversight is a central bank function 2 The rationale for the Eurosystem’s involvement in the oversight of payment and settlement systems 3 Oversight responsibilities 4 Scope of oversight 4.1 Payment systems 4.2 Payment instruments 4.3 Securities clearing and settlement systems 4.4 Correspondent banks and custodian banks 4.5 Third-party service providers 5 Oversight methods 6 Organisational set-up and allocation of roles within the Eurosystem 7 Cooperative oversight 7.1 Interdependencies and location of payment and settlement systems 7.2 Cooperative oversight arrangements 7.3 Cooperation with other authorities 9 Chapter 13 The Eurosystem’s catalyst role 1 A catalyst for market efficiency and integration 2 Leadership and coordination 3 Areas of involvement 3.1 Integration of retail payment markets 3.2 Integration of securities infrastructures 4 Developing and sharing the Eurosystem’s expertise Chapter 14 Legal basis and cooperation framework 1 The legal basis for Eurosystem involvement 1.1 Introduction 1.2 The Eurosystem’s powers in the area of payments, clearing and settlement 1.3 The Eurosystem’s interest in the clearing and settlement of financial instruments 1.4 The ECB’s legal acts and instruments 2 The Eurosystem’s cooperation framework 2.1 The need for interaction 2.2 The European level – cooperation and interaction with other authorities 2.3 The European level – interaction with market participants and other stakeholders 2.4 Interaction at the global level 3 Organisation within the ECB and the Eurosystem 3.1 Decision-making bodies of the ECB 3.2 Organisation at the ECB 3.3 Advisory bodies to the ECB’s decision-making bodies BIBLIOGRAPHY 329 GLOSSARY 341 BOXES Box 1 The most common non-cash payment instruments Box 2 Selected issues concerning communication networks Box 3 Access to payment systems Box 4 Netting Box 5 Central bank and commercial bank money Box 6 Different types of payment system Chart A: Payments settled in a multilateral net settlement system Chart B: Payments settled via an RTGS system Chart C: The settlement process with a central queue 10 Box 7 Fraud prevention Box 8 Two-sided markets and interchange fees Chart: The interchange fee structure Box 9 Developments in issuance Box 10 Eurobond issuance Box 11 Some advantages and disadvantages of direct and indirect holding systems Box 12 Settlement intervals Box 13 Procedures in a securities transaction – a slightly complex example Chart: Securities clearing and settlement procedures Box 14 How portfolio compression works Box 15 A basic legal framework Box 16 Roles played by central banks in the development of payment systems Box 17 Principles for effective oversight Box 18 Distinction between banking supervision and oversight Box 19 The SEPA building blocks Box 20 Main benefits of SEPA for the various stakeholders Box 21 15 barriers to an efficient EU clearing and settlement environment Box 22 Consolidation in the stock exchange industry Box 23 Consolidation around the two ICSDs Chart A: Consolidation around the two ICSDs: Euroclear Chart B: Consolidation around the two ICSDs: Clearstream Box 24 Regulations and directives Box 25 Liquidity management features in TARGET2 Box 26 Oversight policy documents published by the Eurosystem Box 27 The Eurosystem’s oversight policy on business continuity Box 28 The oversight of retail payment systems Box 29 ESCB-CESR recommendations for securities clearing and settlement in the European Union