SECURITIES CLEARING Corp. of the Philippines (SCCP) has migrated to the shortened settlement cycle in a bid to boost the domestic capital market.
“Aside from aligning the settlement cycle with major international markets, we expect that market participants will soon experience the benefits of operating in a T+2 (transaction plus two days) environment,” SCCP President and Chief Executive Officer (CEO) Ramon S. Monzon said on Monday.
SCCP secured the approval of the Securities and Exchange Commission on Aug. 10 for its request to migrate to the T+2 settlement cycle on Aug. 24.
According to the firm, the shift to the T+2 cycle aligns the Philippines with international markets such as the United States, most European Union member states, and the major markets in the Asia-Pacific region.
It added that the T+2 cycle lowers the risks of unsettled trades under a T+3 regime and encourages more efficiencies in the local capital market.
SCCP is a wholly owned subsidiary of local bourse operator Philippine Stock Exchange, Inc. (PSE). Mr. Monzon concurrently serves as PSE president and CEO.
“On Aug. 29, SCCP settled two batches of trades where Batch 1 comprised of the last T+3 trades executed on Aug. 23 and Batch 2 comprised of the first T+2 trades which were executed on Aug. 24. All transactions were settled before their respective settlement deadlines,” SCCP said.
“Subsequent settlements until Sept. 4 were done before 1:00 p.m., the extended settlement deadline that is in effect until Sept. 11. Starting Sept. 12, the settlement deadline will revert to the 12:00 noon regular deadline,” it added. — Revin Mikhael D. Ochave