Notes from the Vault

image of a bank vault

The TARGET2 Settlement System in the Eurozone
Gerald P. Dwyer
March/April 2012

  • Positive and negative balances have built up in TARGET2, the payment system in the eurozone.
  • The negative balances are debts of national central banks backed by collateralized loans to private banks.
  • The positive balances generate interest for national central banks that carry those balances, but the balances do not represent the risk exposure of the national central banks.

Notes from the Vault was on hiatus after the March/April 2012 post; it restarted in March 2013.

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