As a result of the central securities depository regulation (CSDR) which will migrate European markets to T+2 settlement beginning in October, the International Capital Markets Association (ICMA) will change the standard settlement cycle for cash transactions.
ICMA is adjusting its rules because the ICMA Market deals with transactions that fall outside the scope of CSDR. The ICMA Market deals with international securities, intended to be traded on an international cross-border basis through an International CSD, which are often negotiated bilaterally and may be neither executed nor reported to a trading venue. Thus, these transactions would not fall under the shorter settlement cycle mandated by CSDR.
ICMA also plans to shorten the settlement cycle of securities finance transactions such as repo from T+2 to T+1.