After all, systemically important is impossible to define.

Business continuity oversight expectations for systemically important payment systems

Some member states favor restricting European supervision to systemically important banks.

Business continuity oversight expectations for systemically important payment systems

Systemically important retail payment systems will be assessed against the Core Principles .

These objectives were also designed with a view to achieving a level playing field for the different schemes from a regulatory point of view .

In 2006 the Governing Council adopted business continuity expectations for systemically important payment systems .

Such assistance included extended liquidity swap facilities with the central banks of four large and systemically important economies .

Association ( EBA ) .

They are complemented by the business continuity oversight expectations for systemically important payment systems ( SIPS ) which were adopted by the Governing Council in 2006 .

The paper contains implementation guidelines with regard to business continuity for systemically important payment systems based on Core Principle VII .

The Core Principles are complemented by the business continuity oversight expectations for systemically important payment systems ( SIPS ) which the Governing Council adopted in 2006 , giving the industry a deadline for implementation by June 2009 .

Commentators appreciated the transparency of the Eurosystem 's intentions regarding the oversight of retail payment systems . However , they also remarked that the application of the Core Principles to retail payment systems in the EU countries should be based on harmonised criteria .

A strengthened multilateral economic surveillance framework should be able to ensure that economic policies , especially in systemically important countries , are stability oriented and sustainable .

In the second half of 2009 the EURO1 system was assessed against the business continuity oversight expectations for SIPS .

In the second half of 2009 the Eurosystem started assessing the degree of compliance of the SIPS with the business continuity oversight expectations .

With the integration of the euro payments market and the establishment of a Single Euro Payments Area ( SEPA ) , national specificities that justify an assessment diverging from the commonly agreed Eurosystem framework are expected to vanish over time .

It is envisaged that some standards will also apply to major custodian banks ( systemically important custodians ) which are very active in the field of clearing and settlement .

Current preparations are also focused on ensuring the full compliance of the future TARGET2 system with the Core Principles for Systemically Important Payment Systems 12 , which were adopted as minimum standards by the Governing Council .

All Core Principles will be applied to systemically important retail payment systems , whereas only a selection of six Core Principles will be applied to systems of prominent importance .

It is of the utmost importance that systemically important payments i.e. those that could cause a systemic risk if not processed when due be carried out without delay , even in abnormal circumstances .

These standards are the Core Principles for Systemically Important Payment Systems , defined by the G10 Committee on Payment and Settlement Systems ( CPSS ) and adopted by the Governing Council in 2001 .

in EU wide macro prudential supervision of systemically important financial institutions on the basis of Article 127 ( 6 ) of the Treaty .

On 3 September 2010 the Governing Council authorised the publication of an assessment report on the implementation status of the Eurosystem 's business continuity oversight expectations for systemically important payment systems .

The Core Principles apply to systemically important payment systems 3 of all types .

Applying the Core Principles to systemically important retail payment systems does not , in the view of the Eurosystem , put these systems at a competitive disadvantage vis àvis other retail payment systems .

handle retail payments there would generally be no alternative payment channel available to the public through which to effect retail payments , should this retail system fail . The volumes processed via such a system would normally be too high to be handled via the real time gross settlement ( RTGS ) system .

On 15 July 2010 the Governing Council approved the conclusions of an assessment of the progress made on the implementation of business continuity oversight expectations by systemically important payment systems operating in euro .

On 31 May 2006 the Governing Council approved a report on business continuity oversight expectations for systemically important payment systems .

Each SIPS must comply with all ten Core Principles . While all large value payment systems in the euro area are considered systemically important , some retail payment systems may also be of systemic importance and will thus have to fulfil the entire set of Core Principles .

He stressed the need for humans to think both systematically and long term.

These now form an integral part of the Eurosystem 's oversight framework and help to ensure a sufficient and consistent level of resilience across all systemically important payment systems which are located in the euro area and operate in euro .

The standards adopted today contain indicators for categorising retail payment systems into systemically important retail payment systems , retail systems of prominent importance and other retail payment systems .

On 4 May 2007 the Governing Council decided to launch a public consultation on the draft Eurosystem common methodology for the assessment of euro systemically and prominently important payment systems against the Core Principles .

It is based on the internationally accepted Core Principles for Systemically Important Payment Systems , defined by the Committee on Payment and Settlement Systems ( CPSS ) and adopted by the Governing Council in 2001 .

Following the June 2009 deadline for the implementation of the business continuity oversight expectations for SIPS , an assessment of TARGET2 against these expectations started in the second half of 2009 .

This is being done with a view to obtaining information about developments in the euro payments business as a whole , and not only in the established interbank systems . In 2002 the Eurosystem 's oversight activities were aimed at ensuring the continued compliance of systemically important payment systems with existing oversight standards and at developing oversight standards for retail payment systems .

In February 2001 the Governing Council of the ECB adopted the Core Principles for Systemically Important Payment Systems 2 ( Core Principles ) as the set of minimum standards that the Eurosystem uses for its common oversight policy on payment systems .

E PAYMENTS In recent years , the increasing use of new communications technologies and the need for specific payment mechanisms for e commerce have created opportunities for new intermediaries to facilitate the sending and processing of payment instructions .

The RTGS systems intending to connect to the current TARGET system , together with all other systemically important euro infrastructures in the Member States concerned , will be subject to oversight assessments in accordance with the Eurosystem 's common oversight policy .

ECB Annual Report 2009 TARGET2 In early 2009 the Eurosystem TARGET2 overseers completed their comprehensive oversight assessment ( which had been initiated in late 2006 ) of the design of TARGET2 against the Core Principles for Systemically Important Payment Systems .

The BCOE for SIPS provides guidance to SIPS operators in order to achieve sufficient and consistent levels of resilience , focusing on business continuity strategy , planning and testing , as well as crisis management .

At the same time , banks have also developed new means for customers to access their accounts and to originate payments . 12 The ECB aims to provide a forum for cooperation between stakeholders and to offer analyses and statistics to support the work of the markets in further developing more efficient and secure payment mechanisms .

By overseeing payment systems , in particular those that are systemically important 15 , the Eurosystem contributes to the safety and efficiency of financial infrastructures and , consequently , to the efficiency of payment flows for goods , services and financial assets in the economy .

CONTINGENCY MEASURES FOR SYSTEMICALLY IMPORTANT PAYMENTS IN TARGET Owing to the TARGET system 's pivotal role in the market and its broad market coverage , suitable protection against a wide range of threats is essential for the reliable and smooth functioning of the system .