Categories: Wire Stories

Market Participants Believe Shorter Settlement Cycles are on the Horizon, Citi Survey Shows

LONDON–(BUSINESS WIRE)–A Citi survey shows market participants around the world increasingly believe that shorter settlement cycles will become reality.

The second edition of Citi�s “Securities Services Evolution” whitepaper shows 51% of market participants expect the prevailing settlement timeframe for equities to be T+1 by 2026 – up seven points from last year’s survey. This sentiment is supported by several key markets moving towards a T+1 settlement cycle recently, including the United States, Canada and India.

Okan Pekin, Global Head of Securities Services at Citi, said: “We are seeing a greater sense of momentum and purpose in all developments across the industry, in particular the determination to move to a T+1 settlement cycle. Delivering these changes will be no small feat but in due course offer the prospect of very substantial cost savings and efficiencies.”

Citi’s whitepaper includes quantitative and qualitative data gathered from 12 financial market infrastructures (FMIs) and almost 300 market participants from banks, broker-dealers, asset managers, custodians and institutional investors around the world. Collectively, these insights continue to provide a rare, holistic view of ongoing developments across the global securities market ecosystem.

Some new findings from this year’s whitepaper include:

  • 88% of market participants stated that their organizations are either actively participating in, or exploring use cases for digital assets, blockchain or distributed ledger technology (DLT).
  • 54% said a DLT-based market infrastructure could cut post-trade processing costs by 10-30%.
  • 79% believe that atomic settlement is achievable in less than 10 years.
  • 92% see the value and benefits of tokenization to market liquidity, and variety of tradeable assets.

FMIs and market participants continue to have opposed views on a number of topics. For example, FMIs see risk reduction as a major benefit of reducing settlement cycles, which will in turn enable lower margin requirements and the release of capital. In contrast, only 17% of market participants survey felt the same way.

On the other hand, FMIs and market participants have become more closely aligned on their views regarding DLT’s role in facilitating a successful transition to T+1/T+0. FMIs believe that while DLT has a role to play, it is not an essential requirement. Only 21% of market participants (down vs 40% last year) think DLT will be core to a shortened settlement cycle.

With over $25 trillion* of assets under custody and administration and with an industry-leading proprietary network spanning over 60 markets, Citi Securities Services provides clients with extensive on-the ground local market expertise, innovative post-trade technologies, customized data solutions, and a wide range of custody and fund services that can be tailored to meet clients’ needs.

*As of 6/30/2002, represents totals assets under custody, administration and trust.

Citi

Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in more than 160 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.

Additional information may be found at www.citigroup.com | Twitter: @Citi | YouTube: www.youtube.com/citi | Blog: http://blog.citigroup.com | Facebook: www.facebook.com/citi | LinkedIn: www.linkedin.com/company/citi.

Contacts

Media:
Rekha Jogia-Soni

rekha.jogiasoni@citi.com

Alex

Recent Posts

CGTN: China vows continued efforts to build Asia-Pacific community with shared future

BEIJING, CHINA - Media OutReach Newswire - 8 November 2024 - Since its inception more…

2 hours ago

TBS Energi Utama to Acquire Singapore’s Integrated Waste Management Services Provider, Sembcorp Environment Pte. Ltd.

Acquisition Expands TBS’ Regional Waste Management Platform in Indonesia and Singapore, aligning with its TBS2030…

4 hours ago

Score 11 Unbeatable Deals This 11.11 on Shopee with 90% Off Lowest Price Guaranteed

KUALA LUMPUR, MALAYSIA - Media OutReach Newswire - 8 November 2024 - It’s that time…

6 hours ago

Shenzhen China Wins the World Smart City Award, Demonstrating the Global Influence of Social Intelligent Governance of Mega City

BARCELONA, SPAIN - Media OutReach Newswire - 8 November 2024 - On November 6, Central…

7 hours ago

Singapore – A Trusted Global Supply Chain Management Hub

SINGAPORE - Media OutReach Newswire - 8 November 2024 - Singapore is strengthening its position…

8 hours ago

OPPO Celebrates Global Photography Talent at Paris Photo Fair under the theme of “Dear Life”

PARIS, FRANCE - Media OutReach Newswire – 8 November 2024 - This year, OPPO once…

9 hours ago