ICMA responds to ESMA Call for Evidence on the Shortening of the settlement cycle


15 December 2023 ICMA has responded to the ESMA Call for Evidence on the shortening of the settlement cycle.  The response was produced by ICMA’s T+1 Taskforce, representing around 150 members, including sell-sides, buy-sides, market infrastructures as well as other relevant service providers.

ICMA views a potential EU move to T+1 as a significant undertaking with wide-ranging implications, not only for the post-trade process, but also from a trading, market-making liquidity and funding perspective. A move to T+1 is would come with significant risks that need to be carefully considered, and that are exacerbated by the complexities and fragmentation of the EU market. In that sense, ICMA strongly supports ESMA’s Call for Evidence with the aim of conducting a thorough assessment of all the expected costs and benefits of such move. It is important that the outcome of this process is, at this stage, considered open. Given the far-reaching and market-wide implications, it is critical that any decision in favour or against a further shortening of the settlement cycle is based on a solid understanding of costs and benefits.

Read the response here.

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