The future transition of T+1 in the UK

An interview with Andrew Douglas, chair of the UK Accelerated Settlement Taskforce Technical Group

In November of 2024, the European Securities and Markets Authority (ESMA) recommended that the European Union (EU) adopt a deadline of 11 October 2027 for a change to a T+1 trade settlement lifecycle for securities, the same deadline proposed by the UK Accelerated Settlement Taskforce in its February 2025 report: https://acceleratedsettlement.co.uk/publishes-final-implementation-plan/

corfinancial® recently sat down with Andrew Douglas, chair of the UK Accelerated Settlement Taskforce Technical Group (AST), charged with overseeing the delivery of a T+1 settlement cycle in the UK. In this interview we discuss the future transition of T+1 in the UK and the practical steps asset management firms can take to smooth the process.

Andrew Douglas: “Winston Churchill famously, if the contents of a report had to be actioned immediately, would add a note to the report that read: ‘Action This Day’. What people may not know is that that today five percent of UK cash equity trades are already settling on T+1. It is clearly possible to operate a T+1 system within a T+2 environment and I encourage all participants to ‘action this day’ and make the change to T+1 sooner rather than later.

Reflecting on what happened in the US, with only three months to go 30% of firms had done little to prepare according to research prepared by the Value Exchange, who undertook periodic readiness or ‘pulse survey’ studies across a wide cross section of participants. We are planning to ask Value Exchange to do the same in the UK, starting in 2025 with a pulse survey every 6 months so we can track our own readiness.

‘Don’t wait until 11 October 2027’ is the key message. I advise firms to stay informed and use information published on our new website at www.acceleratedsettlement.co.uk, and extract from it what you need to do to be compliant. Create a development plan and use the 2025 budget cycle to secure funding for your preparatory projects in 2026 – carrying out the necessary updates to your own back- and middle- office processing. This will ensure that at the start of 2027, your firm will be ready for testing.”

Read the full interview

Salerio: Defeating the Clock in Post-Trade Processing – Your Imperative Solution in the Age of T+1 Settlement

Defeating the Clock in Post-Trade Processing

In the relentless race against time in the operational world of asset management, the ticking clock of the T+1 trade processing arrival can be your greatest adversary. The post-trade processing landscape is evolving, and the consequences of falling behind are dire. In the business-critical environment, Salerio emerges as the indispensable guardian of your firm’s efficiency and success. Without it, the cost of lagging behind is a haunting reality.

The Threat of the ‘T+1 Arrival’: A Race Against Time
Shifts towards more T+1 settlement cycles are reshaping the fabric of post-trade processing. The demands for speed, accuracy, and compliance have never been higher. Asset management firms find themselves at a crossroads, where manual processes and outdated systems are becoming obsolete relics in the face of a ticking clock.

“Automate for Acceleration” – Automation for faster and error-free post-trade processes.

The consequences of missing T+1 deadlines are severe, ranging from financial penalties to reputational damage that can harm a firm’s standing in the industry. Falling behind is a palpable concern, and without a solution like Salerio, the risks are significant.

Salerio: Your Unassailable Fortress in the T+1 Era
Salerio is not just a solution; it is the imperative answer to the challenges posed by the arrival T+1 in several trading regions, with more to come. This cutting-edge software system is engineered to automate and streamline post-trade processing, ensuring that your firm not only meets but surpasses the demands of the accelerated settlement cycles.

Automated Efficiency:
Salerio eliminates the shackles of manual processing, ushering in an era of unparalleled efficiency. It automates complex post-trade workflows, reducing the risk of errors and ensuring that your firm operates at the speed imposed by T+1 trading. No longer will you be tethered to time-consuming, error-prone processes that put your firm’s operational costs on the line.

Real-Time Visibility:
In the T+1 era, information is power. Salerio provides real-time visibility into post-trade activities, enabling your firm to make informed decisions swiftly. With a comprehensive overview at your fingertips, you can navigate the complexities of post-trade processing with confidence; never being blindsided by unforeseen challenges.

The Reality for Those Without Salerio
For those without Salerio, T+1 is fraught with problems. Picture a scenario where every second counts, and the absence of automation leaves your firm mired in the inefficiencies of outdated processes. The fear of missing T+1 deadlines, of incurring financial penalties, and tarnishing your firm’s reputation becomes a real issue for concern.

In the fast-evolving landscape of post-trade processing, the time for complacency is over. Salerio is your shield against the impending storm. Don’t let the ticking clock dictate your fate – embrace the transformative power of Salerio and be a frontrunner in the race against time. The future of post-trade processing belongs to those who embrace innovation – make Salerio your ally in conquering the operational challenges of the changing T+1 era.

If you would like to discuss any of the points raised here, please contact us at resources@corfinancialgroup.com or click here to learn more about corfinancial’s post-trade settlement solutions, Salerio and SureVu.

Are your trade processing systems fit for purpose?

Not fit for purpose showing an ice cream cone

David Veal, Senior Executive at corfinancial®, outlines why trade processing systems in the buy-side arena may no longer be fit for purpose.

Wealth Management

The T+1 settlement cycle is due to be instigated in May 2024, and efficient trade processing systems are critical for the smooth operation of any financial institution. However, when such systems fail to address demands for accurate, efficient, and fast-paced processing, it can have far-reaching consequences for an organisation. This article dissects key factors that can lead to the failure of a trade processing system being fit for purpose, with a focus on common technical and operational issues. 

Root causes of problems with dated trade processing systems

Technical issues
Inadequate infrastructure: one of the primary technical issues that contribute to the failure of such systems is outdated and inadequate infrastructure – Dated systems often struggle to handle an increasing volume of trades, leading to performance bottlenecks and frequent outages.

Integration challenges: the lack of integration with other critical systems, further exacerbates technical shortcomings – This results in a disjointed workflow and hinders real-time decision-making.

Scalability problems: many in-house systems can fail to scale effectively with the growing demands of the business. As a result, increasing numbers of trades lead to delays, inaccuracies, and ultimately economic and reputational costs from failed trades.

Operational issues
Inefficient processes: poor or manually orientated operational processes play a significant role in the failure of many trade processing systems. Manual data entry, redundant workflows, and a lack of automation lead to errors, delays, and increased operational costs.

Inadequate training or intuitive functions: lead to suboptimal utilisation of a system’s capabilities and an increased risk of errors.

Insufficient monitoring and alerts: the absence of robust and timely alerts means that potential issues are not identified and addressed in a proactive manner. A reactive rather than proactive approach further exacerbates the impact of operational challenges.

Needing more people: reducing operating windows, where exception management is not maximised, results in a need for ‘more hands on deck’, in order to beat the clock. Changing working hours for operational staff can be challenging and costly.

Implementing changes
Organisations need robust solutions to address the technical, operational, and procedural challenges that lead to failures associated with ineffective systems. Two prominent platforms that have demonstrated effectiveness, governance, and controls in trade processing management are Salerio and SureVu from corfinancial.

Salerio is a trade management platform known for its ability to streamline trade processing operations and enhance efficiency, addressing technical issues that plague trade processing systems.

Here is how Salerio can serve as a solution:

  1. Scalable infrastructure: designed to handle high volumes of trades, ensuring that the system can adapt to the evolving needs of the business without compromising performance.
  2. Seamless integration: Salerio offers seamless integration with other critical systems, including OMS and position-keeping platforms. This integration fosters a cohesive workflow, enabling real-time decision-making and reducing the risk of disjointed operations.
  3. Automation and workflow optimisation: by automating manual processes and optimising workflows, Salerio minimises errors and delays associated with inefficient operational procedures, leading to increased operational efficiency and reduced costs.

SureVu is a failed trade management solution designed to enhance an organisation’s adherence to industry standards and regulations. In the wake of the new Settlement Discipline Regime (‘SDR’) introduced by the CSDR, SureVu plays a pivotal role in failed trade avoidance, rather than failed trade management activities still adopted by many firms.

SureVu provides governance to reduce the risk of settlement discrepancies. Its intuitive interface empowers users to avoid settlement failure rather than manage it, enabling high levels of STP.

Solving the problems
By integrating Salerio or SureVu into the operational framework, organisations can easily address the root causes of previous system failures.

Salerio’s technology addresses trade matching and processing issues, while SureVu helps firms avoid settlement failure as opposed to managing it after the fact. As part of a core middle office solution, these systems provide a comprehensive approach to trade management, fostering a resilient trade processing operation for sustainable growth when replacing dated solutions.

Salerio and SureVu resolve operational headaches and fears of a costly operational team that are destined to be a reality in the second half of 2024 cost-effectively and comprehensively. Salerio and SureVu do it well… and that includes the price.

If you would like to discuss any of the points raised here, please contact us at resources@corfinancialgroup.com or click here to learn more about corfinancial’s post-trade settlement solutions, Salerio and SureVu.

T+1 settlement – The imperative for automated solutions in the securities market

T+1 global transactions

By Samil Aslam, Research Analyst at corfinancial®

Efficient settlement processes are crucial to the smooth functioning of the securities market. The introduction of T+1 settlement, where trades are settled one business day after the transaction, has gained significant attention in recent months. This shift from the T+2 settlement lifecycle has presented both opportunities and challenges for market participants. To navigate these complexities and streamline operations, automation has become essential. In this article, we delve into the impact of T+1 settlement and highlight the need for automated solutions, regardless of the global region introducing the change. 

The significance of T+1 settlement
T+1 settlement has brought about several advantages that contribute to a more efficient market. By reducing the settlement period, it minimises counterparty risk and provides quicker access to funds, enhancing liquidity. It also reduces the need for participants to tie up capital for an extended period, allowing them to deploy it more effectively. Additionally, shorter settlement cycles reduce market participants’ exposure to potential market risks, resulting in a more stable and secure trading environment.

Data and statistics have consistently shown that shorter settlement periods, such as T+1, can significantly impact market volatility. Studies indicate that shorter settlement cycles can reduce the scope for speculation and market manipulation, thereby enhancing market integrity and increasing market efficiency.

With the implementation of T+1 settlement, market participants face the challenge of adapting to a faster-paced settlement process. Manual settlement procedures that rely on cumbersome paperwork, manual reconciliation, and communication between various parties are increasingly becoming inefficient and error-prone. To address these challenges, automation is essential.

Settlement failure and non-compliance with the settlement discipline regime can harm an asset management firm’s reputation. These incidents may be perceived as a lack of operational robustness or failure to meet regulatory requirements. Negative publicity could result in a loss of client trust, potential outflows of assets under management, and damage to long-term business relationships.

Increased operational complexity and costs
The settlement discipline regime introduces new requirements and procedures, such as mandatory cash penalties and transaction reporting obligations. Asset management firms need to adapt their existing processes and systems to ensure compliance, which often involves significant operational changes. The additional complexities can strain internal resources and require substantial investments in technology and infrastructure.

Asset management firms may also face increased operational costs due to potential penalties for settlement fails. The additional expenses associated with compliance can impact profitability and potentially lead to higher fees for investors.

The move to T+1 is undoubtedly a step forward for the industry, but key questions remain for middle office or operational teams:

  • Will your operational practices easily adapt to the pressures of T+1 deadlines?
  • Does your trade processing technology enable you to proactively avoid trades from failing?
  • Is your platform scalable enough to adapt to the demands of same-day processing activities?
  • Are you prepared for custodians to change their Service Level Agreements?
  • Are you prepared for your operating day to be extended?

Salerio and SureVu: automated solutions for efficient settlement
Salerio and SureVu are cutting-edge technologies that streamline the settlement process, reducing risks and increasing operational efficiency. Salerio is an automated post-trade management solution that ensures timely and accurate reconciliation of trades, automating the matching of trades across multiple platforms. By eliminating manual intervention, Salerio reduces settlement failures and minimises the risk of trade discrepancies.

SureVu, on the other hand, is an advanced tool that provides real-time insights into the settlement process. It leverages data to monitor trade statuses and proactively identifies settlement issues. With SureVu, market participants gain comprehensive visibility into their trades, enabling timely interventions and minimising settlement failures.

Automation eliminates manual errors and reduces the time spent on manual reconciliation, freeing up resources for more strategic tasks.

All of which address the bullet point questions raised above.

Conclusion
The introduction of T+1 settlement has ushered in a new era of efficiency and reduced risk in the securities market. However, to fully harness the benefits of shorter settlement cycles, market participants must embrace automation. Solutions like Salerio and SureVu offer the necessary tools to streamline post-trade processes, minimise settlement failures, and enhance overall operational efficiency. By leveraging automation, market participants can navigate the complexities of T+1 settlement with confidence, fostering a more robust and secure securities market for all stakeholders. Automation eliminates manual errors and reduces the time spent on manual reconciliation, freeing up resources for more strategic tasks.

If you would like to discuss any of the points raised here, please contact us at resources@corfinancialgroup.com or click here to learn more about corfinancial’s post-trade settlement solutions, Salerio and SureVu.

Salerio trade processing goes live at Jennison Associates

Jennison Associates + Salerio

New York, March 14, 2023 – corfinancial®, a leading provider of specialist software to the financial services sector, announces that New York-based investment manager Jennison Associates (Jennison) has implemented Salerio, their post-execution trade processing, matching, confirmation and settlement instruction management system.

Salerio’s centralized trade processing management enabled Jennison to retire several inefficient and expensive-to-maintain legacy systems. This provided major gains in data accuracy and real-time management of executed trades earlier in the middle office trade management process.

Jason Minkler, Managing Director and Head of Operations at Jennison Associates, said: “Salerio provides exception management workflows across multiple asset classes via a centralized dashboard which has significantly improved our middle-office processes. We are now able to automate trade workflows and reduce operational risk. The software delivers the mission critical capabilities and governance needed to get ahead of issues.”

Minkler adds: “The Jennison team and corfinancial worked very well together, forming a strong partnership that gave us a solid knowledge base before going live with equities in December. Additional asset classes are scheduled to go live throughout 2023. Furthermore, Salerio supports Jennison’s global trading model, with corfinancial providing round-the-clock support.”

David Veal, Senior Executive – Client Solutions at corfinancial, said: “Our post-trade processing solution is intuitive, making it easy for clients like Jennison Associates to migrate away from legacy systems with confidence. Working in partnership with Jennison, we have enhanced Salerio, which will benefit firms preparing for T+1.”

Founded in 1969, Jennison Associates manages $164 billion of client assets (as of December 31, 2022) in a range of equity and fixed income investment strategies. Jennison’s investing approach is rooted in its fundamental research and security selection; all portfolios are built from the bottom-up, security by security, and its internal research underlies all investment decisions.

For more information on the salerio solution, contact corfinancial at info@corfinancialgroup.com.

Archer turns to Salerio to add retail trade processing

Archer logo

Boston, May 3, 2022 – corfinancial®, a leading provider of specialist software and services to the financial services sector, announces that Archer, a leading technology enabled service provider for investment managers, has extended their use of corfinancial’s  Salerio® Post-Trade Execution solution to commence trade processing for their retail services.

Headquartered in the Philadelphia region, Archer provides a robust ecosystem of technology and services to the asset management industry. An early adopter of Robotic Processing Automation, Archer continues to deploy advanced technology like Salerio to streamline processes for investment manager clients and their brokers.

“As more investment managers launch new products specifically for retail investors, we’re continuing to invest in technology that creates powerful operational efficiencies for our clients,” said Bob Lage, EVP, Global Head of Product and Technology at Archer. “At Archer, we’re always looking to upgrade our tools in ways that allow our clients to grow their businesses. By integrating Salerio into our trade settlement process, we are adding automation that creates significant efficiencies in matching trades across our clients’ counterparties.”

Archer used Salerio to migrate its institutional clients away from DTCC’s OASYSTM utility in December 2021 and began moving its retail clients in March 2022. This latest move with the retail application of the technology enables asset managers to match trades more rapidly through a centralized service. Specifically, Salerio facilitates enhanced connectivity to banks and brokers via DTCC’s CTMTM utility, including SWIFT messaging – all highly automated and fully integrated into the Archer IBOR, dashboards and reporting.

David Veal, Senior Executive for Client Solutions at corfinancial added: “Archer’s confidence in our Salerio solution is well-received and this recent change reflects the flexibility of our product to adapt to different operational processes, creating a comprehensive, centralized solution that can scale as our clients’ businesses grow.”

SureVu – CSDR introduction – gaining competitive edge

CSDR Trade Settlement

Lower risk, higher efficiency: gaining competitive edge in CSDR trade settlement.

The Central Securities Depositories Regulation (CSDR) has been in force since September 2014 and introduces regulatory change on a regular basis. There are a number of rules and industry changes being introduced in the near future by the CSDR, one of which is the new Settlement Discipline Regime (SDR), expected to come into force on 1 February 2022. It introduces several major changes to the settlement of financial instruments that will have a major impact on all market participants, not least the operations of buy- and sell-side firms.

CSDR Trade Settlement

corfinancial’s Salerio selected by Man Group to migrate OASYS trade processing

System migration
London, 28 June 2021 – Salerio, the post-execution trade processing solution from corfinancial, has been selected by Man Group, the global active investment management firm, to assist in their migration from the OASYS™ US securities trade processing flows to the DTCC’s Institutional Trade Processing (ITP) CTM™ (Central Trade Manager) platform.

Last year, DTCC announced that it would decommission OASYS™ on 31 October 2021.

Man Group has been automating key post-trade processes, including trade confirmation and settlement for international securities, for many years using Salerio. It was, therefore, the natural solution to manage the migrating US trade confirmation workflow.

Salerio provides seamless connectivity to DTCC’s CTM platform and Man Group was able to manage the transition of US equity trades processing via OASYS to the CTM utility without the need for vendor support.

Antonio Dos Santos, Head of London Investment Operations at Man Group, said: “We wanted to ensure the continuity of our centralised post-trade processing in light of the changes soon being introduced by the DTCC. With Salerio’s rich workflow capabilities, the transition was a simple one and we moved most of our US equity traffic over to the Salerio CTM module with ease.”

David Veal, Senior Executive – Client Solutions at corfinancial, said: “Our post-trade processing solution is intuitive, making it easy for clients like Man Group to manage their operations with confidence. During 2020, we enhanced Salerio to ensure that it fully encompasses the changes being introduced by the DTCC that allows the processing of both US and international post-trade securities through the CTM service.”

corfinancial’s Salerio selected by Man Group as treasury solution for FX processing

Foreign exchange

London, 19 July 2021 – corfinancial today announces that Man Group, the global active investment management firm, has selected its treasury solution, Salerio, to manage the firm’s foreign exchange confirmation, settlement and netting processing.

Man Group uses Salerio to automate the management of securities post-trade processing and is expanding the use of Salerio to incorporate automation of foreign exchange processing. The investment management firm’s international growth has relied increasingly upon Salerio, which automates key middle office processes.

Salerio will also support Man Group’s CLS (Continuous Linked Settlement) netting – a standardised, automated bilateral payment netting service.

Richard Craske, Change Management Specialist at Man Group, said: “We have been a long-term user of Salerio to manage our trade confirmation and settlement.  The high volume of our securities trading – that can reach in excess of 30,000 allocations per day – demands the very best in technology and Salerio has more than proved its worth. We now want to incorporate foreign exchange processing and CLS netting in the same, centralised processing model. With Salerio’s treasury modules in place we can continue to scale our operations efficiently, allowing our teams to focus on handling exceptions.”

Bruce Hobson, CEO at corfinancial, said: “We are delighted to have been selected by Man Group to bring further efficiencies to their post-trade processes. We look forward to Man Group extending the use of Salerio to incorporate FX processing, completing the treasury deployment during 2021.”