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The Treasury Market Practices Group (TMPG) and the Securities Industry and Financial Markets Association (SIFMA) today announced updated practice guidance for closing times for delivering U.S. Treasury securities. The TMPG and SIFMA recommend that market participants adopt these updated closing time practices in lieu of previously issued practice guidance by June 1, 2009.
The proposed closing time practices would allow all participants to originate deliveries until 3:00 p.m. each day, in line with current industry practice. The proposed closing time practices would further allow, but would not require, market participants to originate and receive deliveries on a mutually-agreed basis during the 15 minute interval between 3:00 p.m. and 3:15 p.m. [1]
The need to update closing time practices became evident during implementation-related discussions among TMPG members and other market participants in the course of operationalizing the TMPG’s fails charge practice recommendation. Some market participants expressed dissatisfaction with the existing market convention under which dealers can deliver Treasury securities to customers until 3:15 p.m., but customers can usually only deliver Treasury securities to dealers until 3:00 p.m. In addition, these discussions highlighted that previous SIFMA delivery guidelines were not being followed uniformly across market participants, further adding to the impetus to provide updated guidance in this area.
Please refer to the document titled “Recommended Closing Time Practices for Delivering U.S. Treasury Securities” for additional details on the updated recommended closing time practices for delivering U.S. Treasury Securities.[2] Market participants are invited to submit any related comments or feedback by May 15, 2009. Comments may be submitted via e-mail to: tmpg@ny.frb.org.
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The Securities Industry and Financial Markets Association brings together the shared interests of more than 600 securities firms, banks and asset managers. SIFMA's mission is to promote policies and practices that work to expand and perfect markets, foster the development of new products and services and create efficiencies for member firms, while preserving and enhancing the public's trust and confidence in the markets and the industry. SIFMA works to represent its members’ interests locally and globally. It has offices in New York, Washington D.C., and London and its associated firm, the Asia Securities Industry and Financial Markets Association, is based in Hong Kong.
[1] The times listed in this announcement assume a normal securities wire close at 3:30 p.m. In the event the securities wire closing deadline is extended then these times would be later, but would remain the same relative to the extended close time.
[2] The updated closing time practice recommendations can be found at www.newyorkfed.org/tmpg
