THE
TRADETECHFX
THE OFFICIAL NEWSPAPER OF TRADETECH FX 2024
Daily
NORGES BANK INVESTMENT MANAGEMENT | NORDEA ASSET MANAGEMENT | DWS | MN | PGGM INVESTMENTS | BBH
Did CLS make the right call in not extending its cut-off after T + 1 ?
DESPITE THE MULTI-CURRENCY SETTLEMENT SYSTEM ’ S DECISION COMING UNDER FIRE FROM BOTH THE BUY-SIDE AND CUSTODIANS , CLS HAS NOT SEEN A DROP OFF IN DAILY SETTLEMENT VALUES AND VOLUMES , SUGGESTING – AT LEAST FOR NOW – THAT IT MAY HAVE BEEN THE RIGHT DECISION .
The decision by CLS not to extend its cut-offs in the lead up to North America ’ s shift to T + 1 was met with concern from several corners of the industry . However , in its first analysis post the implementation , the data shows that perhaps the multicurrency netting system was wise to stick to its guns . Given that CLS had chosen not to amend its cut-offs , there were fears prior to the transition to T + 1 on 28 May that asset managers would face a lastminute scramble to adjust their operations and trading to avoid pre-funding , bilateral settlement and moving team members to the US . However , according to an update in July , CLS had seen no decrease in average daily settlement values and volumes over the first month of T + 1 in the US , though some trends were noted as emerging .
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