MSRB Requests Comment on Shortening the Settlement Cycle for Municipal Securities

Date: November 10, 2015

Contact: Jennifer A. Galloway, Chief Communications Officer
              (703) 797-6600


Alexandria, VA – The Municipal Securities Rulemaking Board (MSRB) is seeking public comment on a proposal to facilitate shortening the settlement cycle for transactions in municipal securities in response to a securities industry-led initiative to shift the current settlement cycle for all fixed-income and equity securities from T+3 (trade date plus three days) to T+2 (trade date plus two days).

“The MSRB is supportive of transitioning to a shorter settlement cycle as a means of both reducing risk and saving costs,” said MSRB Executive Director Lynnette Kelly. “To ensure we can address any areas in MSRB rules that would present challenges to a shortened settlement cycle, we encourage municipal market participants to provide input on this potential change.”

Draft changes to MSRB Rules G-12, on uniform practice, and G-15, on confirmation, clearance, settlement, would enable the first shortening of the municipal securities settlement cycle since 1995. The T+2 settlement cycle, if adopted by all relevant regulators, would apply across the securities industry, including not only municipal securities but also equity securities and corporate bonds. The initiative is being led by the Industry Steering Committee (ISC), chaired jointly by the Investment Company Institute (ICI) and the Securities Industry and Financial Markets Association (SIFMA).

Comments to this request for comment should be submitted to the MSRB no later than December 10, 2015.

The MSRB protects investors, state and local governments and other municipal entities, and the public interest by promoting a fair and efficient municipal securities market. The MSRB fulfills this mission by regulating the municipal securities firms, banks and municipal advisors that engage in municipal securities and advisory activities. To further protect market participants, the MSRB provides market transparency through its Electronic Municipal Market Access (EMMA®) website, the official repository for information on all municipal bonds. The MSRB also serves as an objective resource on the municipal market, conducts extensive education and outreach to market stakeholders, and provides market leadership on key issues. The MSRB is a self-regulatory organization governed by a board of directors that has a majority of public members, in addition to representatives of regulated entities. The MSRB is overseen by the Securities and Exchange Commission and Congress.