UK chancellor of exchequer Rachel Reeves has confirmed that the country will move to T+1 settlement on 11 October 2027. The confirmation was given at a meeting with senior representatives from the investment banking and asset management sectors on 19 February. Additionally, the government indicated acceptance of all recommendations for the transition made by the UK’s Accelerated Settlement Taskforce.
The UK’s move to T+1 is a part of the Plan for Change, which aims to drive economic growth in the country. Included under the Financial Services Growth and Competitiveness strategy is a commitment from the government to ongoing engagement with the industry – JP Morgan, Blackrock, Abrdn, Morgan Stanley, Goldman Sachs, Citi, Fidelity, and Schroders were present at the meeting.
Smooth operator
Along with its recommendations, the taskforce has also released an implementation plan to ensure a smooth transition to T+1. Terms of reference have already been published for its next phase. The government has agreed to bring forward legislation that can facilitate the transition.
Led by Andrew Douglas, the taskforce will be overseeing the UK’s transition to T+1, and will remain active for a short period after the transition to evaluate its short-term impacts. Industry chairs from the EU and Switzerland are welcomed to observe the UK taskforce to facilitate alignment for the move across Europe.
Andrew Bailey, governor of the Bank of England (BoE), says, “Shortening the UK securities settlement cycle to T+1 will bring important financial stability benefits from reduced counterparty credit risk in financial markets. It is important that firms and settlement infrastructures have robust plans for an orderly transition in October 2027.”
