Clearance and settlement was thrust into the spotlight during the meme stock crisis, with calls to reduce the current standard T+2 settlement cycle with real-time gross settlement. 正如最近的一篇文章所解释的那样 白皮书, 存 believes, and the industry agrees, that T+1 is the optimal settlement cycle for today. By reducing the time between trade execution and settlement to T+1, the industry would reduce systemic 风险, 操作风险, 流动性需求, 买方交易对手风险敞口, and broker-to-broker counterparty 风险. It would significantly lower the 风险 and uncertainty arising from unsettled trades during market volatility, such as what we saw earlier this year, while enhancing capital efficiency.
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A move to T+1 would also allow market participants to continue to leverage the National Securities 清算 Corporation’s (NSCC) netting feature which delivers great cost efficiencies to the industry. 每一天, netting reduces the value of payments that need to be exchanged by an average of 98% across all settlement cycles. On an average day in 2020, NSCC netted down $1.77 trillion dollars in total daily trade activity to a final settlement value of just under $38 billion.
代理/经销商, a move to T+1 would lead to a significant reduction in margin and collateral requirements. 平均超过13美元.4 billion is held in margin each day to manage counterparty default 风险 across the system. Shortening the settlement cycle would help strike an improved balance between 风险-based margining and procyclical impacts.
Some industry participants have suggested that real-time gross settlement (RTGS) could be a better solution to address margin requirements. While RTGS could have some benefits, they are outweighed by the challenges it presents. Because all transactions would need to be funded on a transaction-by-transaction basis, the benefits of netting and financing could be eliminated. Also, it is important to note that RTGS is not the same as netted T+0 settlement. 净T+0结算, trades could still be netted and settled at the end of the same trading day. NSCC offers this functionality today, and 直接转矩 is already a T+0 platform and settles transactions on a near-instantaneous basis, all with existing classic technology.
改善结算周期 can be addressed in two ways: through technology and by shortening the actual standard settlement cycle timeline.
也就是说, the employment of new technologies has been a key priority for 存 when considering enhancements to the existing settlement infrastructure. 2021年初, 项目离子, which uses distributed ledger technology (DLT), was introduced to bring new efficiencies to settlement. 现在, with six months of successful testing of the prototype completed, we are building out the platform to a production-ready workflow with a detailed roadmap for full industry integration and adoption.
项目离子 will adhere to 存’s rigorous regulatory requirements across resiliency, 稳定, 安全, 风险, and controls and will be designed to provide an additional settlement option for the industry that will deliver upon our core benefits of 风险 management and volume capacity. 这包括净额, 中国共产党的贸易担保, and seamless interoperability between the 项目离子 platform and 直接转矩’s classic settlement platform. The platform is a parallel effort to the current industry move to T+1, and will be capable of supporting T+1, T+0 and other settlement timelines.
改善结算周期, and further reducing the 风险s within the cycle, can be addressed in two ways: through technology, 在某些情况下是新技术, and by shortening the actual standard settlement cycle timeline, 安全及适当地. Right now, we firmly believe that T+1 is the most appropriate settlement cycle. We will continue to collaborate with market participants and relevant associations to work towards achieving T+1 while increasing efficiency and lowering 风险 across the industry.
This article was initially published in Sibos on October 7, 2021.