INTERVIEW | Andrew Douglas and Giovanni Sabatini – the leading industry coordinators for the T+1 transition in respectively the UK and EU – were among the chief attention grabbers at early September’s PostTrade 360° conference in Stockholm. Europe’s moves have been surprisingly rapid, on the back of great buy-in from everybody in the securities industry. Or … rather, nearly everybody. We joined them for a chat.
A great event, a good occasion to pass messages, and a very timely one in relation to the recently published recommendation by the EU industry group. This is Giovanni Sabatini’s verdict as he sums up his conference experience by afternoon on the second, and last, day. With settlement time frames squeezed to sometimes just hours, throwing more people’s attention at a failure just won’t be a way to solve it any longer. So, current improvements are all about getting everything right from the start. A series of practically focussed sessions on segments of the lifecycle – “the T+1 track” – drew a large audience.
“The key messages are automation and standardisation – and also, inventory and funding management will become critical,” says Giovanni Sabatini, Independent Chair of the EU T+1 Industry Committee.
However …
“All the participants here are well aware. Those who are not here are probably the ones who would most have needed to be here – to understand how their businesses will be impacted.”
Many groups of securities-industry actors are up and running in a good way to produce the shift. Yet, Douglas and Sabatini are in clear agreement over one group where too many actors are still insufficiently engaged: the asset management firms, not least many smaller ones.
“In a world where the settlement process is compressed into a few hours, then, from the beginning of the trade, you have to start to understand where the funding comes from, where the securities are, and knowing in advance how you could manage a potential lack of securities. In the current environment, perhaps that could be managed by the back office but under T+1, already at the very beginning of the trade, you need to foresee how you will manage the whole process,” says Sabatini.
“May not happen this time”
Andrew Douglas, Chair of the UK T+1 Taskforce, gives a similar picture, no less clear.
“Asset managers are the community I struggle to get access to. There are so many of them and there is a long tail of smaller asset managers who don’t have the bandwidth to closely follow this sort of complex industry initiative. I think they rely heavily on their brokers and custodians to help them get over the line. And one of the things that concerns me is that this may not happen this time. People need to be ready for themselves,” says Douglas.
“The law (both UK and EU CSDR) will dictate that you must settle on T+1 from 11 October 2027 and I would find it a very concerning strategy as an asset manager to rely on my success being in the hands of others. I would want to take control of that myself. This is why talking to you is a useful exercise; if there’s one asset manager who reads this article and goes away thinking ‘I’ve got some work to do here’, then that’s a win for me.”
• Our news posts around the PostTrade 360° 2025 conference on 3-4 September are gathered here.
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• The conference info site with a detailed agenda is here.
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