JSE moves to shorter settlement cycle

June 7, 2016 12:16 pm3 commentsViews: 21

JSE technoMTHULISI SIBANDA
JOHANNESBURG – THE Johannesburg Stock Exchange’s (JSE’s) shorter T+3 settlement cycle will take place on July 11.

This follows the completion of the final market testing phase of the project.

The JSE currently settles on a 5 day (T+5) settlement cycle, and will be moving to three-day cycle (T+3).

“T+3” is the abbreviation used to describe an Equity Market cycle whereby equities are delivered in exchange for payment in four days from its current six day (or T+5) schedule. The transition aligns South Africa to international best practice settlement standards.

The implementation of a new settlement cycle impacts all market participants, including listed companies, traders, investors, clearing and back office participants, Strate, the JSE and all regulators.

The JSE has requested that listed companies avoid corporate actions between 4 and 18 July in order to reduce complexity during the cutover week.

The move is being spearheaded by the JSE in close collaboration with the South African Reserve Bank, National Treasury, Financial Services Board and numerous other stakeholders to ensure system and process readiness ahead of the move.

JSE Executive Director, Dr Leila Fourie, said grateful to all participants, both local and abroad, for their tremendous support in making market testing a great success.

CAJ News

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