CRESTCo, APACS And LSE Announce Plans To Reduce The Standard Settlement Period For Equities And Corporate Debt

During 1999, the Bank of England, CRESTCo and the London Stock Exchange - together with the Association for Payment Clearing Services (APACS) - have been reviewing the standard settlement period for equities and corporate debt and the market's preparedness for adoption of a shorter settlement cycle. Currently, the standard settlement period for such securities is T+5 (i.e. settlement five business days after trade). Recent soundings of market opinions suggest that there is a wish to move to a shorter settlement period. There is also a view that it will take 12 months for members to amend systems and review their operational procedures. In the light of these soundings, the consultation paper issued by CRESTCo sets out a proposal from the Bank of England, CRESTC-o and the London Stock Exchange that a T+3 settlement standard should be adopted with effect from February 2001.