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T + 1 War Rooms – Asia :
lot of these processes early on , has made put them in a better place for this to go live .”
ANTICIPATING EVOLVING DYNAMIC Looking ahead , participants acknowledged the evolving nature of the post-T + 1 landscape , with a focus on addressing potential impacts on funding costs , margin requirements , and settlement processes . Despite the ongoing hurdles , there was a shared commitment to collaboration and engagement across the speakers in the war room .
One consultant expressed the need for continued innovation , stating , “ The misalignment between security and financial protections is something might be worth delving into . That ’ s a good exercise , because we ’ re flushing out what can be done versus what needs human intervention .” Another custody product manager reflected on the operational aspects of trade affirmation , noting , “ It seems to be more just like operational because we did have a fairly sizable group of clients that just hadn ’ t been affirming before .”
They highlighted the learning curve associated with transitioning to a selfaffirmation model , describing it as a process of training and understanding the workflow . He pointed out a challenge encountered in aligning trade instructions with self-affirmation timelines , which could lead to cancellations by DTCC and unexpected costs for clients . They characterised these challenges as primarily behavioural rather than stemming from inherent risks or inventory issues .
Another emphasised the importance of understanding the true significance of trade affirmation , stating , “ We ’ ve had to educate clients for the last year or more , on what is affirmation . It ’ s just an indication of an intent . It doesn ’ t guarantee anything , it doesn ’ t mean it ’ s going to sell , it doesn ’ t mean it ’ s going to fail . So , in that respect , we ’ ve spent a lot of time telling clients it doesn ’ t really mean anything other than you , indicating the intent to sell .”
They further elaborated on the complexities of achieving 100 % affirmation , particularly when clients rely on custodial affirmation . The challenges of meeting deadlines and conducting necessary checks make full affirmation inherently difficult , he said , and concluded that , from his perspective , there are no unforeseen drawbacks to this approach .
22 Global Custodian Week 1