( MENAFN - Live Mint) " (Adds ICI comments, DTCC issues) By Carolina Mandl and Davide Barbuscia NEW YORK, May 29 (Reuters) - The transition to a faster trade settlement cycle in the U.S. has so far gone smoothly, according to market participants and new data on Wednesday.
On Tuesday, U.S. trading of equities, corporate and municipal bonds and other securities moved to a one-day securities settlement cycle (T 1) from two days (T 2), to comply with a rule change adopted last February by the U.
S. Securities and Exchange Commission. The Securities industry and financial Markets Association (Sifma) said it was optimistic about the progress of the transition to faster trade settlement, while the Investment Company Institute said in a statement that "all T 1 implementation activities have been completed and appear to be operating normally.
" "The first day of trading under T 1 settlement went smoothly," said William Coleman, head of U.S. ETF Capital Markets at Vanguard.
"While there may be some increased risk of failed trades as firms continue to adjust to the new settlement regime, we expect most trades will settle successfully today." An early indication came from data on trade affirmations - or when trade participants verify and agree on the trade details. The Depository Trust and Clearing Corporation said that as of Tuesday evening the rate of total trades being affirmed was 92.
76%, higher than Friday's 89.59%. The higher the affirmation rate is, the more likely trades are .
