(March 9 – 16:30 ET) – The Canadian Capital Markets Association has released a white paper proposing five options for reducing the current settlement period from three days to one day after trade date .

The Association is requesting feedback on the alternatives and unresolved issues from Canadian securities industry stakeholders. The paper is the result of interviews and fact-finding with industry experts, including brokers, dealers, investment funds, fund managers, banks, stock exchanges, securities clearing and settlement organizations and regulators. The results were analyzed by IBM Global Services and Katamax Solutions.

The CCMA identified problems and opportunities in the still highly labour-intensive business of trade processing and it aimed to design an approach that addressed these factors.

“The ‘New Design’ model is focussed on addressing the concerns of the Canadian marketplace,” says Allan Cooper, chairman of the CCMA. “The made-in-Canada “New Design” is simple, with a blend of sequential and matching processes that provides a direct interface with the settlement system.”

While the “New Design” model was built to meet Canadian needs and to integrate with other models being developed for use in the U.S., the report discusses the pros and cons of different alternatives.

The next step in the T+1 process is for industry stakeholders to discuss the relative merits of the different models and identify areas for improvement.

The CCMA is seeking industry-wide feedback from the Association of Canadian Pension Management, Caisse Centrale Desjardins, Canadian Life and Health Insurance Association, Canadian Pension and Benefits Institute, Credit Union Central of Canada, Mutual Fund Dealers Association and others.
-IE Staff