Clearstream has released an updated version of its Settlement Prediction Tool, designed to help clients manage settlement risk more effectively and prepare for the transition to shorter settlement cycles, states the company.
The tool uses artificial intelligence to analyse transaction details and historical settlement patterns. Based on this, it predicts the likelihood of timely settlement and estimates potential penalty costs. According to Clearstream, the tool can identify at-risk instructions up to four business days in advance, giving clients time to act before a transaction fails.
Operational pressures
The upgrade comes as market participants face increasing demands to tighten post-trade processes, particularly with the shift to T+1 settlement in North America and similar developments under discussion in Europe. With less time to resolve issues before settlement, early detection of potential fails is gaining importance.
By providing advance visibility into high-risk instructions, the tool aims to support firms in reducing settlement penalties and improving overall process efficiency. The additional insights can help teams prioritise their efforts and allocate resources more effectively across settlement operations.
