Faster Stock Settlement Times Likely

An E.U. lawmaker announced her support for shortening the time to settle trades to two days, improving the chances of a common transatlantic approach to curbing settlement risk in securities trading.

At present, the industry standard is T+3, or three days after the trade. The new proposal would change that to T+2. On Thursday UK MEP Kay Swinburne said she would back T+2, allaying fears that she would push for a stricter next-day settlement requirement.

“I do see T+2 as a starting point over time,” she told a conference held by European banking lobby AFME.

U.S. regulators are also looking at shortening the standard American three-day settlement time. With strong resistance against next-day settlement, T+2 seems the most likely outcome there as well.

“The European Commission’s proposal for a T+2 settlement cycle paves the path for increased efficiency across Europe,” said Marianne Brown, chief executive of Omgeo, a company jointly owned by Thomson Reuters and U.S. clearing house DTCC that specializes in trading services.

“Ultimately, it is anticipated that the T+2 initiative in the EU will drive other markets, including the United States, to look at accelerating their settlement cycles.”

Read more about the push for faster settlement times.

Photo credit: buddawiggi

Share this post

Share on facebook
Share on twitter
Share on linkedin
Share on pinterest
Share on print
Share on email

Stay On Top Of The Debt Relief Industry's Regulatory Landscape

On November 6-7, 2022, Shipkevich PLLC will be hosting a Regulatory Workshop in Costa Mesa, California focusing on the fundamental regulatory issues facing debt relief professionals and how they can adapt.