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While the world’s biggest markets are still preparing for T+1 settlement, talk is growing of the next step – but going any faster would mean a total reworking of how markets function.
First it was the end of Libor, back in 2021 and again in 2023. Now, in 2024, many markets have a new and potentially even more disruptive challenge to negotiate. On May 28, the US, Canada and Mexico will move from a two-day settlement period for securities transactions to just one day after trade date, what the industry calls T+1.
The change was formalised by the adoption of a rule by the US Securities and Exchanges Commission back in February 2023, a move that started the clock on one of the most far-reaching changes to have been attempted in global markets.
Some industry professionals at the sharp end of the transition do not sound confident that things will be entirely smooth.
