Stet

As the CORE System is a “straight through” Clearing and Settlement Mechanism, enabling an early delivering of the processed transactions to the financial addressees, the issue of settlement has been cautiously implemented.

A common Guarantee Fund has been set up in order to avoid any lack of liquidity among STET’s Direct Participants. This Guarantee Fund can be activated by TARGET2 during the settlement phase, with STET’s acknowledgment.

Enhancing the use of this common Guarantee Fund, the CORE System is regularly checking the balance of each Direct Participant. If needed, it may ask for individual provisions in order to ease the liquidity constraint.