Latest: issuers stick to T+2/T+3 settlement as T+1 not mandatory for primary issuance

On Tuesday, the US markets opened with T+1 settlement following more than three years of preparation, after Canada, Mexico and Argentina implemented the change the day before when it was a public holiday in the US.

‘Securities’ as defined cover equities, corporate bonds, unit investment trusts (UITs), mutual funds, ETFs, American depositary receipts (ADRs) and options

Moving from T+2 to T+1 does not merely mean investors have 50% less time to carry out post-trade processing. Banks and brokers will face roughly 80% less time to manage cross-border settlements under T+1 due to added complexity of time-zone and FX challenges, noted Swift, which owns Swift Code.

The products in scope are securities that do not carry an exemption from 17 CFR § 240.15c6-1(a). ‘Securities’ as defined cover equities, corporate bonds, unit investment trusts (UITs), mutual funds, ETFs, American depositary receipts (ADRs) and options, among other things. Application extends to the purchase and sale of securities issued by investment companies, including mutual funds, private-label mortgage-backed securities and limited partnership interests that are listed on an exchange.

For new issuances of structured notes, issuers are sticking with T+2 or T+3, which are still permitted. “For secondary market trades, which it does apply to, there isn’t much trading generally and so there hasn’t been much of an impact,” a partner at a US law firm specializing in derivatives told SRP.

Commerzbank completes FX derivatives migration to Murex

The German bank announced on Tuesday that it has ‘completed a strategic migration and simplification’ of its global foreign change (FX), FX derivatives, equities and commodities activity, streamlining trading and risk in Murex’s integrated MX.3 platform. The project started in 2020 and was supported by TeamTek and Infosys.

‘The new setup enables Commerzbank to significantly enhance process efficiency and simultaneously reduce costs. Additionally, it lays the foundation for future business growth as we can more swiftly adapt to market changes,’ said Sebastian Kauck (right), Commerzbank’s CIO for corporate clients.

Specifically, Infosys carried out development, integration, testing and migration activities alongside go-live and aftercare support.

The project allows future expansion through an integrated cross-asset platform, enabling further steps of digitalization, according to Luc Testud, managing director, central Europe at Murex.

Jakota Capital strengthens presence in Taiwan following AMC launch

The subsidiary of Jakota Group has unveiled its website and new hires in management and corporate finance in Taiwan after its launch of an actively managed certificate (AMC) listed on SIX Swiss Exchange.

The Jakota Semiconductor AMC, which went live in January 2023, was issued by Zurich-based asset management firm Smartprofit Finder AG, which aims to outperform the Jakota Semicon Index, a benchmark comprising the top 75 prime-listed semiconductor firms in Asia developed by Jakota Index Portfolios.

The duo have entered into ‘a long-term collaboration agreement’, effective as of 1 June 2024, with a focus on the Jakota region (Japan, South Korea, Taiwan).  

Among senior hires based in Taipei is Chenduan Mei, managing director, who will in charge for global sales and marketing of structured products based. Meanwhile, Katarzyna Lomnicka (right), CEO of Smartprofit Finder, has been appointed as chairwoman of Jakota Capital.

Swissquote becomes preferred partner of GenTwo Pro for Banks

Swiss fintech GenTwo on Wednesday announce that Swissquote, a Swiss banking group specialising in online services, is the inaugural member and preferred partner of the new GenTwo Pro for Banks platform – the first Switzerland-based B2B AMC platform, according to the provider.

GenTwo Pro for Banks is designed to offer their clients the ability to create bankable products on all liquid or digital assets with the fastest time to market at the lowest price point in the industry. The products are off-balance sheet and issued in Switzerland. 

‘This move allows us to leverage GenTwo technology to expand our AMC business through low-friction, cost-effective structured product creation. This in turn will provide more choice and opportunity for our clients in line with our overall mission to democratize banking,’ said Jan De Schepper (right), chief sales and marketing officer of Swissquote.

SIX, Korea Securities Depository tighten partnership

SIX, through its SIX SIS subsidiary, has signed a memorandum of understanding (MOU) with Korea Securities Depository (KSD) to cooperate in the area of securities depository and settlement.

Based on the terms of the MOU, SIX and KSD will cooperate in the area of securities depository and settlement to foster the prosperity of financial markets, promote cross border investment and explore opportunities for joint development.

The partnership also envisages a closer working relationship in the future, regular meetings and the maintenance of communication channels for the exchange of information.

Javier Hernani (right), head securities services and executive board member at SIX , said: "'The agreement is another step forward in expanding our reach in Asia, where we see business opportunities, explore new markets, and establish new relations. Given our strong position in the global post-trade value chain, we believe that this new partnership will boost the joint value and growth potential.”

The scope of the mutual cooperation features such areas as mutual support for investment in the Korean and Swiss markets. It also includes the mutual exchange of information on operation and market as well as improvement opportunities.

iCapital brings DLT fund with UBS

Fintech platform for alternative investments iCapital has launched its first fund leveraging its new distributed ledger technology (DLT) with UBS Wealth Management acting as the distributor.

The launch marks a technological advancement ‘for increasing scale and real-time connectivity across the alternative investments experience,’ according to iCapital, which declined to disclose the fund name or type when reached out by SRP. 

The DLT is designed to simplify the lifecycle management of alternative investments and is expected to eliminate over 100,000 activity reconciliations over the average life of a private capital fund, improving data processing visibility and efficiency, reducing errors and enhancing overall investment handling.

iCapital is set to roll out more funds with other partners ‘in the coming months’, according to chairman and CEO Lawrence Calcano (right). 

Image: Aramyan/Adobe Stock.

---

Do you have a confidential story, tip or comment you’d like to share? Write to info@structuredretailproducts.com.