The Investment Association has published a report on the move to T+1 in the EU, UK, and Switzerland. Titled “T+1 settlement: Navigating the UK, EU, and Swiss transition”, the paper serves as a roadmap for asset managers, wealth managers, fund administrators, and custodians to manage the shift.
Focus is put on the operational, technological, and liquidity challenges of a shorter settlement cycle, especially in trade matching and FX activities. The paper also outlines “key considerations for each impacted area and clear, actionable recommendations to support firms in designing, and executing their T+1 transition programmes”.
Key points
The five key recommendations for T+1 readiness include:
• Put project plans, governance, and budgets in place now
• Accelerate automation across the post trade lifecycle
• Review and strengthen FX operating models
• Prepare to move fund settlement cycles to T+2 by 11 October 2027
• Ensure the accuracy and completeness of standard settlement instructions (SSIs)
Four areas of impact are highlighted: trade allocations, confirmations and matching; settlement; fund cycles; other strategic and operational issues, including third party reliance. For each area, the report provides a detailed timeline for completion, partly based on recommendations from the UK’s Accelerated Settlement Taskforce (AST).
