Thursday, October 6, 2022

Is T+1 Something We Can All Agree On?

The Industry Reacts to a Compressed Settlement Plan

Author: David Schwartz J.D. CPA

In moving to shorten the U.S. securities settlement cycle by one day to T+1, the Securities and Exchange Commission appears to have hit on something upon which virtually everyone can agree. Judging by the comments to the SEC's T+1 proposal, everyone from State Street to the Cornell Securities Law Clinic agrees that moving to T+1 is both desirable and beneficial to risk management in the long run. That said, despite this rare moment of accord...

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Categories: All, Change Overview and Rationale, Formal Regulatory Remedies, Cross-Post

Tags: securities lending, Risk Management, SEC, ICI, De-risking, ADRs, RMA, T+1

Friday, September 30, 2022

Serious Doubts About the SEC's Short Sale Proposals

Disclosures Could be a Real Challenge for Managers and Brokers

Author: David Schwartz J.D. CPA

In February of 2022, the Securities and Exchange Commission proposed new disclosures to provide more transparency into institutional investors' short-selling activity. According to Chairman Gensler, collecting more granular data from large short sellers "would help us to better oversee the markets and understand the role short selling may play in market events." Despite these lofty goals, industry commenters are raising serious questions about whether some...

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Categories: All, Change Overview and Rationale, Disclosure Regimes, Formal Regulatory Remedies, Cross-Post

Tags: securities lending, short selling, dodd-frank, SEC

Monday, April 18, 2022

SEC Gets an “Earful” on Securities Lending and Short-selling Disclosure Proposals

And Another Thing - Longer Comment Periods, Please

Author: David Schwartz J.D. CPA

The Securities and Exchange Commission's controversial securities lending disclosure proposal (Proposal) sought public input on 97 questions and received a substantial body of feedback during the initial 30-day comment period. Drawing sharp rebukes, most responses from trade associations for lenders and borrowers focused on the ambiguous scope of rule 10c-1, the feasibility of the proposed 15-minute reporting regime, lopsided cost and technology burdens, and the risks of reverse...

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Categories: All, Formal Regulatory Remedies, Procedural Changes, Cross-Post

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Thursday, March 3, 2022

Disclosure and Beyond: Restructuring the U.S. Equity Markets

BRIEFING GUIDE to the SEC's Aggressive Agenda to Head off the Next "Big Squeeze"

Author: David Schwartz J.D. CPA

On Friday, February 25, 2022, the Securities and Exchange Commission (SEC) proposed its latest round of GameStop rule proposals. In addition to enhanced public disclosures of short sales by institutional investors, the Commission announced a 30-day extension of the comment period on its sweeping securities lending disclosure proposal, Rule 10c-1, and technical amendments to the "consolidated audit tape" regulations. These separate, but related, disclosure proposals may well be...

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Categories: All, Change Overview and Rationale, Formal Regulatory Remedies, Cross-Post

Tags: securities lending, short selling, SEC, T+1

Tuesday, February 15, 2022

T+1: The Future is Now (or at least as early as 2024)

The SEC Boldly Sets Course for T+1 and T+0

Author: David Schwartz J.D. CPA

While real-time settlement is still something that may happen far in the future, perhaps on the Starship Enterprise, T+1 is now imminent. On February 9, 2022, the Securities and Exchange Commission proposed to make T+1 a reality. The proposal aimed at reducing risks in clearance and settlement seeks comment on shortening the current T+2 standard settlement cycle for most broker-dealer transactions by one day to T+1. Notably, the proposal also makes clear that T+0 is the ultimate and eventual...

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Categories: All, Change Overview and Rationale, Formal Regulatory Remedies, Cross-Post

Tags: swaps clearing, Risk Management, SEC, T+1

Commentary

Is T+1 Something We Can All Agree On?

The Industry Reacts to a Compressed Settlement Plan

Serious Doubts About the SEC's Short Sale Proposals

Disclosures Could be a Real Challenge for Managers and Brokers

SEC Gets an “Earful” on Securities Lending and Short-selling Disclosure Proposals

And Another Thing - Longer Comment Periods, Please

Disclosure and Beyond: Restructuring the U.S. Equity Markets

BRIEFING GUIDE to the SEC's Aggressive Agenda to Head off the Next "Big Squeeze"

T+1: The Future is Now (or at least as early as 2024)

The SEC Boldly Sets Course for T+1 and T+0

Journal Commentaries

Keep Regulation Functional (October 2008)

The Bear Market Posse, or Counterparty Risk Management during the Recent Turmoil (Sept. 2008)

Searching for New Paradigms at BIS (July 2008)

Will Basel II Affect The Competitive Landscape? (September 2003)