Accelerated Settlement – Global Trend, Local Challenges

Accelerated Settlement – Global Trend, Local Challenges

Posted on September 17, 2023 by Cathy Wright

T+1 in North America arrives on the 27^th May in Canada then the 28^th May in the USA. For international capital markets and investors world-wide the impacts are extensive and go far beyond simply working faster, or adapting existing practices. Earlier this year ISITC Europe published its industry preparedness for accelerated settlement academic report commissioned by the SWIFT Institute. The report laid out the landscape of the impacts of T+1 in the international markets. It was derived from extensive research over the preceding 9 months. The research was undertaken under academic disciplines and was written by Dr. Anthony Gandy visiting Professor at the London Institute of Banking  and Finance and Director of Academic Research at ISITC Europe, who will be presenting details of the research at SIBOS 2023 in Toronto. The report also included input by Professor Daniel Broby from Ulster University Business School.

 

This report ‘Accelerated Settlement – Global Trend, Local Challenges‘ has been derived from the research, but includes further analysis and outlines some additional areas that fall under the heading of unintended consequences, which need to understood. There has been a great deal of media activity around T+1 this year with numerous number of events discussing the problems of T+1. Most of the discussions have mainly involved the sell-side of the industry with very little comment or input from the buyside and even less from investors. This report addresses this missing aspect of T+1  and goes further into questioning why for example (unlike when the move from T+3 to T+2 was contemplated) there has been no cost benefit analysis conducted, prior to the scheduled move.

The Accelerated Settlement – Global Trend, Local Challenges Report, builds on the initial report and provides a series of recommendations that actors in the Capital Markets need to consider and address in the areas of business, technology and operational processes and procedures.  It will help all firms involved in the settlement chain to gain a deeper and wider appreciation of the challenges of T+1 from both the sell-side and importantly the buy-side. It highlights the international collaborations that appear missing, which could aid in a smoother transition for T+2 to T+1, provides a simple guide for firms who are not already prepared can meet the settlement requirements for the North American move to T+1 in May 2024.

Download a copy   

ISITC Europe will be continuing to facilitate cross market education on T+1 through a series of topic specific roundtable discussions through out 2023/2024 in association with the CISI, IA and PIMFA kindly hosted by EY. For further information or to apply for a place click here