State Street Rolls Out StreetFX Solution for T+1 Settlement

Boston-headquartered State Street Corporation (State Street) announced that it is offering an automated workflow solution and integration with DTCC Institutional Trade Processing (ITP) and its central trade matching platform, CTM® within State Street's foreign exchange (FX) trading service, StreetFX℠, preparing for the transition of the U.S. equity market to a T+1 settlement cycle scheduled for May 28, 2024. The Depository Trust & Clearing Corporation (DTCC) is the premier post-trade market infrastructure for the global financial services industry.

CTM is a central matching platform used by end-user clients to allocate and centrally match transactions globally across multiple asset classes. With the integration, StreetFX can now receive settlement instructions from DTCC ITP for match agreed CTM transactions. StreetFX automatically executes the required FX trade necessary to fund the purchase or sale of the related securities transaction at the next scheduled execution time designated by the client, streamlining the FX lifecycle and enabling a faster no-touch post-trade processing workflow. Moreover, utilizing in conjunction with the CTM Match to Instruct (M2i) workflow, StreetFX is able to execute the necessary FX trade shortly after the affirmation of the securities trade and staging at the DTCC for T+1 settlement.

Tony Bisegna, Head of State Street Global Markets, said: "State Street is helping to drive solutions that address critical performance drivers by rolling out an automated FX execution solution to facilitate the US securities market's transition to T+1 settlement. This innovative advancement is another example of State Street's commitment to providing industry-leading firsts to our clients."

Val Wotton, Managing Director and General Manager of ITP at DTCC, said: "CTM's open architecture enables us to work with multiple firms within the industry to support the industry's move to T+1 next year. We are pleased that our collaboration with State Street reinforces that CTM represents an efficient and cost-effective solution to address the FX trading challenges that come with a shorter settlement cycle. We look forward to working with a broad range of market participants over the coming months to help them prepare for a seamless transition to T+1."

A shorter settlement cycle will help reduce counterparty risks, improve investor capital efficiencies and alleviate risk pressure on the entire industry. At the beginning of this year, the Indian stock markets​ achieved its complete transition from T+2 to T+1 regime.