AFME comments on US move to one-day settlement cycles

The Association for Financial Markets in Europe (AFME) comments on the announcement by the US Securities and Exchange Commission (SEC) that the US will transition to a one-day settlement cycle (T+1) by May 2024. (eventid=19797)
AFME believes that this goal is ambitious and will pose a significant challenge to all market participants worldwide, AFME is assisting its members and the industry as a whole in preparing for this implementation. The shift to accelerated settlement cycles is seen as a way to reduce risks to financial systems while increasing efficiencies in post-trade processes, and other jurisdictions are now beginning to consider this process. Adopting T+1 settlement in Europe, on the other hand, will be significantly more difficult due to the fragmented nature of European markets and the greater operational, structural, and regulatory complexity.
More research is needed across the industry to quantify the costs and benefits, as well as the changes needed to the current operating environment to facilitate such a transition. AFME will collaborate closely with all stakeholders to ensure an industry-wide approach to this topic, as with AFME’s paper discussing whether Europe (EEA) should move to a one-day settlement cycle. (eventid=17744)