As the U.S. financial industry transitioned to T+1 settlement, DTCC Consulting partnered with a leading broker to deliver a tailored readiness assessment and implementation roadmap.

This proactive approach enabled the client to streamline operations, meet evolving SEC compliance requirements, and successfully transition to T+1 settlement, setting a benchmark for regulatory preparedness in a rapidly changing market environment.

Background

The U.S. Securities and Exchange Commission (SEC) adopted a rule to shorten the settlement cycle by one business day, to T+1, for all U.S. securities transactions that settle through The Depository Trust Company (DTC).

We had the opportunity to work with a U.S. domestic retail broker who was navigating the significant complexities of T+1 settlement in the U.S. market.

The client approached us with a clear set of challenges: they needed to streamline their controls and processes around core trading activity, ensure full post-trade efficiency, and comply with these new SEC rule changes.

They also wanted to understand how changes to DTC file schedules would impact their operations and sought a clear roadmap to guide their transition to T+1 compliance.

Our Approach

To address these needs, we designed a three-phased approach. First, we conducted a comprehensive current state assessment using our post-trade efficiency framework. This allowed us to document the client’s entire post-trade lifecycle and apply industry best practice ratings to each business area.

The result was a heatmap that clearly highlighted which areas would be most affected by the upcoming regulatory changes and where deeper analysis was needed.

Next, we moved into gap analysis. Through targeted workshops, we challenged underlying business assumptions and examined data metrics to pinpoint areas requiring action. This phase was crucial for identifying operational inefficiencies and ensuring the client was prepared to meet SEC rule compliance. 
 
Finally, we worked closely with the client to define recommendations and build a tailored roadmap for T+1 preparations. We prioritized the necessary changes, documented key decision points, and provided data-driven evidence to support each recommendation.

Our roadmap included internal testing considerations, vendor and counterparty outreach, and a deep dive into T+1 testing requirements, making the preparation plan both comprehensive and actionable.

Impact

The impact of our engagement was significant. The client was able to establish a robust T+1 program, collaborate effectively with their vendors, and position themselves ahead of industry trends in regulatory readiness.

Our consolidated assessment and gap analysis identified critical areas for remediation, while our prioritized recommendations and detailed roadmap ensured the client was fully prepared for T+1 compliance.