Industry experts believe the UK may decide not to adopt one of the most controversial aspects of the new settlement regulation post-Brexit.
The delay from ESMA may not have gone far enough according to some market experts who believe challenges persist despite time extension.
After months of lobbying, trade associations and market participants get their wish as ESMA delays introduction of CSDR's settlement discipline regime.
Trade associations have said cash bond markets should be excluded from initial rollout of the CSDR buy-in regime until the regulation’s impact on liquidity is fully assessed.
Both buy- and sell-side firms agree the mandatory buy-in regime will have significant negative implications on Europe’s capital markets.
Daily penalties mean the upcoming Settlement Discipline Regime (SDR) is an issue for the front-office as well as the back, according to the DTCC.
Asset managers have expressed concerns that the CSDR mandatory buy-in regime will impact liquidity and increase costs.
The research explained how, for some firms, most settlement communications still occur through email instead of through secure networks.
Clearstream will apply for a new operating license this autumn as it readies for the introduction of CSDR.
Forthcoming CSDR regulation may lead to inconsistencies with other legislation.