Some 18 months out from the 11 October 2027 deadline for implementing T+1 in the UK, EU and Switzerland, Funds Europe hosted a roundtable to address key concerns of the UK Accelerated Settlement Taskforce and its European working group peers in ensuring the deadline is met by all asset managers in scope.
Representing a diverse group of industry leaders, including representatives from asset managers and servicers, trade associations, and regulatory taskforces, the participants included:
- Andrew Douglas: chair, UK T+1 Accelerated Settlement Taskforce
- Jermaine Nooks: investment operations policy lead, Investment Association
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Zuzanna Hoscilowicz: vice president, client & market solutions, Goldman Sachs FICC and Equities
- Nick Martin: head of operations, Guinness Global Investors
- Emma Johnson: co-lead settlement workstream, EU T+1 Industry committee & head of industry advocacy & insight, The ValueExchange
- Michael Anglim: head of trading, River Global
- Stephen Amoah: head of operations, Polar Capital
- Matt Johnson: executive director, DTCC
- Paola-Maria Deantoni: public affairs officer, Societe Generale Securities Services & member, ESMA Post-Trading Working Group
Several key messages were heard throughout the discussion, leading to an urgent call for those firms in scope that have not got firm plans in place yet to get on and do so. Failure could be costly both in terms of fines but also in terms of counterparty reputation damage.
Key points highlighted include:
- What began as a theoretical industry goal has officially shifted into an “immutable regulatory deadline” across the UK, EU, and Switzerland.
- While moving from T+2 to T+1 sounds like a 50% reduction in time, the functional reality is far more severe. Andrew Douglas, chair of the UK T+1 Accelerated Settlement Taskforce, warns that once you account for the specific processing windows required by custodians and brokers, firms are actually losing nearly all their breathing room. In practice, the industry must now complete a two-day workload in just 17% of the time previously available.
- This time compression creates a dangerous environment for the “hospital pass” – a rugby metaphor for a late or inaccurate instruction that leaves the receiver vulnerable to failure with no time to remediate. Because of market interconnectedness, a failure by a single counterparty can trigger a “domino rally” of settlement issues across the entire ecosystem. This is a major concern for “Tier Two” asset managers, many of whom reportedly have yet to begin building or even budgeting for the transition.
- While equities move to T+1, the global FX market is largely staying on a T+2 cycle. This creates a funding mismatch, as managers may need to pay for a security on T+1 before the necessary currency arrives on T+2. For funds with Asia Pacific exposure, this presents a “liquidity challenge,” as raising cash from markets like Taiwan or Korea (often on T+2 or T+3 cycles) to settle European trades is operationally complex and potentially costly.
- The era of manual intervention is over. To avoid a repeat of the 18% increase in back-office costs seen in the US immediately after T+1 was introduced there, firms must choose between three paths: building internal tech, buying third-party software, or outsourcing to automated service providers. The stakes are high. Between the EU’s CSDR penalty regime and the UK’s Crest fines, settlement failures will become an increasingly expensive line item on fund balance sheets.
- A joint Testing & Readiness Plan has been launched across the UK, EU, and Switzerland to de-risk the transition. The message from industry leaders is clear: testing must start now.
To read the full roundtable report click here.
