The target settlement rate following the T+1 go-live date on 11th October 2027 will be calculated based on the average settlement rate of the three months prior to the deadline (July, August and September, 2027). This is crucial to avoid an increase in settlements fails post-transition and ensure that the market functions as efficiently and effectively on T+1 as it does on T+2.
Key information:
- The Taskforce will publish the market average from the three months prior to form the target for post deadline settlement rates.
- The target comes in line with Recommendation SETT04, outlined in the AST’s Final Report published in 2025.
- This reflects the Report’s methodology that expectations should be anchored in real-world market performance and based on CREST settlement data, rather than a predefined or theoretical benchmark.
- To support firms and ensure that they know what they are aiming for. Starting in 2027, the AST will begin publishing a rolling 3-month average settlement rate, using CREST data, to provide participants with a guide benchmark prior to October 2027.
Andrew Douglas, Chair of the Accelerated Settlement Taskforce, commented:
“Providing a target settlement rate will be an essential North Star for industry to work towards. Ensuring that the market maintains its current settlement success rate once we move into a T+1 world will be a key measurement of the success of the transition overall.
“To achieve this, I would restate that firms must take action now and hit the milestones set out in the Implementation Plan of February 2025. Automation is the most important piece of the puzzle in helping firms to meet shorter settlement deadlines successfully, enabling them to process trades, data and compliance checks faster than ever.”
Kind regards,
Andrew Douglas
Chair, UK Accelerated Settlement Taskforce
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