The Singapore Exchange (SGX) has revised the date for implementing a new settlement process after a glitch forced it to delay the project.
The new processes and penalty framework for failed trades will be implemented on 20 November, instead of the original date of 6 November, and the subsequent implementation of the new buy-in schedule for failed trades will take place on 14 December instead of 30 November.
Last week SGX announced it had delayed the project because of an “isolated incident” in its pre-settlement matching system, which affected the settlement of less than 1% of institutional trades.
On 9 October, the exchange announced it would bring forward the securities delivery deadline to 12.00 on the third day after the trade took place (T+3) to allow the buying-in process for non-delivered securities to be conducted on the afternoon of T+3 instead of the morning of T+4. This would allow the buy-in process to be completed before the trade is deemed to have failed and penalties are imposed.
The changes are aimed at reducing the incidences of non-delivered securities and the imposition of the related penalties.
Under the original plan, SGX was to allow a transition period between 6 and 26 November for market participants to adapt their internal processes. As a result, the new T+3 buy-in time was due to take effect on 30 November.