SEPA and European Payments

The Single Euro Payments Area, the Payments Services Directive, the Eurosystem, TARGET2, STEP2, the Euro and related matters.

Bob Lyddon Consultant at Lyddon Consulting Services

Eurozone private banks gear up to replace Eurosystem Asset Purchase Programmes

The Eurozone banking system will have to gear itself up this autumn to take over the supply of credit from the Eurosystem, as the Eurosystem’s version of QE - called Asset Purchase Programmes – is wound down. The winding-down is in stages. There will be no new purchases to start with, and then the proceeds of maturing bonds will no longer be re-inv...

09 October 2018 /payments /wholesale

Bob Lyddon Consultant at Lyddon Consulting Services

Cyprus' banks reduce their Non-Performing Loans. See how it is done, and weep.

There was an lol for me today, thanks to an article in the Cyprus Business Mail announcing that Non-performing loans (“NPLs”) in the Cypriot banking system had fallen in March 2018 by almost €2.1bn to €19.9bn compared to February’s figure, and that this was the lowest figure for NPLs since December 2014, according to figures issued by the Central ...

13 July 2018 /wholesale

Bob Lyddon Consultant at Lyddon Consulting Services

Virtual Accounts and On behalf of payments raise major AML issues

We have issued another call to Wolfsberg Group, this time to make major changes to the section in their Payment Transparency Standards 2017 on “On behalf of” payments, and the related Virtual Accounts over which such payments (and receipts) are passed. This subject is on the agenda on Day 1 of EBADay in Munich. Our analysis is based on a case study...

05 June 2018 /payments

Bob Lyddon Consultant at Lyddon Consulting Services

Euro Sovereign Bond-Backed Securities, an anagram for colossal stuffee

The EU has unveiled the awaited plan to create Sovereign Bond-Backed Securities or SBBS in Euro, supposedly “to encourage banks and investors to diversify their holdings of euro zone bonds”. The plan is “meant to address a weakness in the currency bloc that came to light in the 2010-2012 euro zone debt crisis, when banks’ high exposure to their sov...

24 May 2018 /wholesale

Bob Lyddon Consultant at Lyddon Consulting Services

The Euro's battle for survival - entering the Red Zone

We have been analysing, for the thinktank the Bruges Group, the extreme difficulties in which the Eurozone finds itself, after years of economic stimulus totalling over 3% of GDP per annum and the build-up of both the ECB's Asset Purchase Programmes and the loans within the TARGET2 system. These imbalances are insoluble, and there is a big bullet ...

22 May 2018 /wholesale

Bob Lyddon Consultant at Lyddon Consulting Services

Is the ECB bankrupt, at least on a mark-to-market basis?

Yesterday Reuters published an article entitled "Restive bond markets may complicate ECB's exit plans". This was a piece speculating about how and when the ECB can taper off and finish its Asset Purchase Programme ("APP"), its version of Quantitative Easing. The piece stated that "Currency strength and a doubling of benchma...

21 February 2018

Bob Lyddon Consultant at Lyddon Consulting Services

Predictions for the Payments industry in 2018: new EU Treaty signed for full EMU

This is the third of our predictions for the Payments industry in 2018, and it is about the Euro and its path to full completion. Brexit is both a threat and an opportunity for the “centralisers” at the European Commission. Their arguments will be firstly that the Single Market and the Customs Union (“Economic” union) cannot work properly and be co...

31 December 2017 /payments

Bob Lyddon Consultant at Lyddon Consulting Services

PSD2 compliance for leg-out payments difficilitated by the virtual elimination of Cover payments

Banks in the EU/EEA will be obliged – as from January 2018 – to quote all-in prices to their customers for: payments going to or coming from outside the EU/EEA, in any currency; and payments with both endpoints in the EU/EEA but where the currency is a non-EU/EEA one like USD or JPY, and where correspondents in the respective currency centres will...

28 September 2017 /payments /regulation

Retired Member 

PSD2 - Time for banks to join in or lose out

It is no secret that the PSD2 regulation will open up the playing field to Fintechs and to the creation of AISP’s (Account Information Service Providers) and PISP’s (Payment Information Service Providers). Banks will have to share account information from their clients while PISPs will be able to generate payments on behalf of an end user. While ...

21 August 2017 /payments

Rakesh Lakhani Executive Director at JPMorgan Chase

How will banning credit card surcharging impact the uptake of PSD2 PISP transactions

PSD2 introduces two measures amongst others that potentially contradict each other and may limit their ability to hit the goals they set out to achieve: Payment Initiation Service Providers (PISPs) PISPs may initiate a transaction on behalf of the customer directly from their bank account. These transactions will bypass card networks and therefor...

17 August 2017 /payments