ICMA publishes discussion paper with proposals to strengthen settlement efficiency in Europe
1 February 2022 In the wake of the go-live of CSDR settlement discipline, the ERCC is releasing its discussion paper, ‘Optimising settlement efficiency’ to focus attention on a number of key opportunities to strengthen settlement efficiency in Europe, which are complementary to the CSDR measures. While ICMA and the ERCC have been supportive of cash penalties, we believe that these should be supplemented by a broader industry effort to support settlement efficiency, focusing on existing tools and processes. Over the past year a number of key issues have been identified and explored further with members in a series of cross-industry workshops, including the shaping of settlement instructions, partial settlement and auto-partialling, as well as automatic borrowing and lending. This paper recaps the key take aways from those discussions and aims to serve as a basis for a broader debate on settlement efficiency with other industry stakeholders, central banks and regulators.
Alongside the paper, the ERCC has published a compilation of best practice recommendations , extracted from the Guide and endorsed by the ERCC Committee at its latest meeting highlighting the commitment by member firms to follow these best practices recognising the benefits for the wider market.