As the industry embarks on a move to accelerated settlement, it helps to look back at the steps taken in 2017 when settlement was shortened to T+2. 从那时起, 存 has been working to gauge industry interest on shortened settlement, 首先是2018年 沉降优化白皮书, and then again in 2019 with strategic initiatives aimed at implementing functional changes to modernize 存’s core systems.
Our strategic efforts around modernizing systems and processes led to the establishment of an industry working group to address 20 significant improvements to equity clearance and settlement. The working group represented a cross-section of the industry, including both institutional and retail broker/dealers, 托管人, 地区性银行, 买方和服务提供商. These meetings began in the fall of 2020 and were dominated by the topic of accelerated settlement, especially as industry stakeholders managed a spike in market volatility, including increased margin requirements at NSCC.
今年一月, 存 proposed a roadmap to implement accelerated settlement to T+1 with the white paper, “Advancing Together: Leading the Industry to 加速解决.“虽然有vns6060威尼斯城官网T+0的讨论, it was concluded that 移动到T+1 could be more realistically achieved by the industry. 这篇论文促使SIFMA和ICI, 存’s industry partners in the 2017 effort to shorten settlement, to engage and make a formal recommendation around a further acceleration of the standard settlement cycle, 移动到T+1.
实现T+1, 帖子-trade agreement needs to happen faster, this is achieved through increased efficiency in the allocation and affirmation processes.
SIFMA started industry working groups to understand the challenges of a shortened settlement cycle and what areas needed further analysis. Ultimately, a decision was made to begin the work needed to move the industry to T+1 and a joint 存/ICI and SIFMA press release was issued. Leveraging the industry structure established for the move to T+2, an industry steering committee was established to provide guidance to the overall project, 然而, the bulk of the work is being done by a working group of 200 industry representatives, who have been participating in daily discussions to develop the industry playbook, identifying challenges and constructing an implementation timeline.
ITP在加速结算中的作用
The working group has also been addressing the crucial processes with Institutional trades that sit at the top of the securities transaction funnel. 实现T+1, 帖子-trade agreement needs to happen faster, this is achieved through increased efficiency in the allocation and affirmation processes.
The move to T+1 aligns with 存 机构贸易处理’s (ITP) move to fully support U.S. trades via a single global central matching platform, 中医. The industry standard 中医 platform – with its community of over 1500 buy and 1200 sell-side firms – provides significant operational efficiency and direct integration with 直接转矩 settlement. Its enhanced central matching workflow boasts a 95% average same day matching rate, 结算通知, and trade enrichment from 存’s 警报 with access to a growing resource of 11 million SSIs.
目前，美国的确认程序正在进行中.S. Institutional trade is performed via TradeSuite, trades affirmed prior to affirmation cutoff at 11:30 AM on T+1 are sent to the 直接转矩 for settlement; for prime broker flow, trades are sent to NSCC’s continuous net settlement (CNS) for netting. Trades that don’t make the affirmation cutoff are processed as delivery orders (DOs), 效率更低，成本更高.
Analysis has shown that unaffirmed trades are 54 times more likely to result in a trade not being authorized by the counterparty in the trade settlement process at 直接转矩, 肯定的交易. These unauthorized trades create significant friction and translate to greater human capital and monetary cost to research the trade. 移动到T+1, those friction points will need to be addressed to ensure that trades settle on a timely basis.
T+1和中医的匹配指导工作流
以T+1的方式解决问题, the working group estimates that an affirmation cutoff of somewhere between 7 PM and 9 PM on trade date is needed. 使用当前生产数据, 55%的交易在晚上7点前得到确认, 到交易当日午夜，还有68%. If the matching component is removed, the data shows further deterioration in affirmation rates.
These points highlight the challenges for the industry to achieve T+1. 然而, the data improves to near 100% by 10 PM with both parties utilizing 中医 and its Match to Instruct workflow.
与中医的匹配指导工作流程, the match between the Investment Manager and the Executing Broker automatically triggers the affirmation of the trade and delivery directly to 直接转矩, eliminating the need for either party to take any further action.
Much more to come as the working groups continue their efforts, the good news is there are tools available today to help make T+1 achievable.