The Securities Industry and Financial Markets Association (SIFMA), the Investment Company Institute (ICI), and The Depository Trust & Clearing Corporation (DTCC) have published The T+1 Securities Settlement Industry Implementation Playbook.
The Playbook outlines a detailed approach to identifying the implementation activities, timelines, dependencies, and risk impacts that market participants should consider to prepare for the transition from the current trade date plus 2 days (T+2) settlement cycle to a trade date plus one day (T+1) settlement cycle. Deloitte & Touche LLP was engaged by SIFMA and ICI to assist in the drafting of this Playbook.
The Playbook was developed as a guide for market participants to identify areas impacted by shortening the settlement cycle and considerations that should be addressed. Every firm has different infrastructure, businesses, and clients, as well as operational processes and geographies that need to be taken into account. It is important to note that, because the SEC’s proposal to shorten the settlement cycle is not yet final, the Playbook serves as a guide to assist with the many complex steps involved in the move to T+1. The Playbook assumes a third quarter 2024 transition date to a T+1 settlement cycle, subject to final regulatory approval, and it may be updated at a later time should regulators select a different transition date.
This is a complex ecosystem that requires full industry participation with the support of regulators, working together to make an efficient, effective and risk-free transition to a T+1 settlement cycle.
SIFMA, ICI, and DTCC partnered to lead the effort to shorten the US securities settlement cycle to T+2 in 2017, which required significant coordination across the industry and spanned multiple operations, functions, and regulations. Similarly, moving to T+1 is a significant undertaking, and the organisations will partner with relevant stakeholders to achieve the many benefits of accelerating settlement to T+1.
