In 2017, the U.S. and Canada will be breaking their 20-year T+3 settlement cycle in what will be the greatest reform since 1995’s migration from T+5 to T+3. The move to T+2 settlement is intended to harmonize with global markets already on a T+2 settlement cycle, reduce risk and exposure, enhance market liquidity, and increase efficiencies. Both countries will be moving approximately 100 products in scope across equities, corporate & municipal bonds, and unit investment trusts (UIT) to a T+2 settlement in the third quarter of 2017. These products combined account for approximately U.S.$950 billion in daily clearing. To prepare for T+2, the Depository Trust & Clearing Corporation (DTCC) is planning to conduct industry testing in Q1-2017 ahead of the proposed go-live date of September 5, 2017.
WHERE DO WE GO FROM HERE? PREPARING FOR SHORTENED SETTLEMENT CYCLES BEYOND T+2
Published: 01 April 2017