DTCC, with the guidance of the Securities Industry and Financial Markets Association (SIFMA), awarded a contract in May to The Boston Consulting Group (BCG) to undertake a business study of the impacts of shortening the settlement cycle for equities, corporate and municipal bonds and UIT trades.
The research firm will study and report on the costs and benefits as well as the impact on related risks that could come from shortening the equity trade settlement cycle in U.S. markets from the current practice of T+3 (trade date plus three days) to T+2 or T+1. The study will also examine the conditions necessary to settle trades on the trade date itself (T+0).
BCG plans to initially interview as many as 35 firms representing all segments of the financial industry, including broker/dealers, custodians, buyside firms and other service providers, followed by an electronic survey of approximately 200 firms. The information gathering will be done in conjunction with SIFMA, which will leverage its various industry committees to provide access to a variety of market participants and subject-matter experts.
Elena Staloff, DTCC Vice President, Equities Clearing Product Management, is managing the study for DTCC. Thomas Price, SIFMA Managing Director for Operations, Technology and Business Continuity Planning, is the other industry contact for the study.
The 18-week study will be completed on September 14. @