Accelerated Settlement

Accelerated Settlement is the reduction of a financial market’s standard settlement cycle, for example, from T+2 to T+1.

‘T’ being the day the trade is negotiated and ‘+2’ indicating that settlement of the trade occurs two days later.

Benefits associated with Accelerated Settlement may include a reduction in settlement risk, improved market liquidity, or a reduction in operational costs.

ISLA has a dedicated Accelerated Settlement (T1) Working Group. Its mandate is to review the challenges, costs, outcomes, potential benefits and impact to securities lending of financial markets moving from T+2 to T+1 in the United States of America, the European Union and United Kingdom.

EPTF

In early 2016, the European Commission (EC) set up an informal expert group on post-trade, including areas of collateral markets and derivatives – the European Post Trade Forum (EPTF). The objective of EPTF in the context the EC’s Capital Markets Union (CMU) project was “to support the work of the Commission to review the developments in post-trading, including collateral management services, in line with the CMU, in order to promote more efficient and resilient market infrastructures in the EU”.

ISLA was a member of the EPTF, alongside other major financial market associations; the ESCB, ESMA and a number of independent experts. ISLA actively contributed to the important work of the EPTF, mainly through its Executive Operations Group.

The final EPTF Report was published on 23 August 2017.