IDEAS home Printed from https://ideas.repec.org/a/aza/jsoc00/y2018v10i1p45-56.html
   My bibliography  Save this article

Securities settlement revolution in Japan: The future of securities settlement

Author

Listed:
  • Yanagawa, Eiichiro

    (Senior Analyst in the Asian Financial Services Group, Celent, The Imperial Hotel Tower 13F 1-1-1 Uchisaiwai-cho, Chiyoda-ku, Tokyo 100-0011, Japan)

Abstract

This paper examines the efforts planned and in progress to shorten the settlement cycle of Japanese government bonds ( JGBs) from two business days after the trade date (T+2) to one (T+1). This report on the so-called ‘securities settlement revolution’, focuses on key trends and changes in the securities settlement market of Japan while exploring legacy systems and ecosystem migration as well as the related possibilities of innovation and emerging technologies in this context. The revolution currently underway in Japan is tackling the below five areas: (1) initiatives to shorten the settlement cycle for JGBs and securities; (2) efforts to enhance the functions, expand use, improve linkages and integration of the central counterparty (CCP); (3) enhanced functions of the central securities depositories (CSD); (4) accelerated adoption and use of straight-through processing (STP) by market participants; and (5) facilitating smoother cross-border securities settlement. The first chapter in this revolution is to be planned for the spring of 2018. In 2012, the market successfully introduced a settlement cycle that was shortened to two business days (T+2) for outright JGB transactions and SC repos (special collateral repurchase transactions) and one business day (T+1) for GC repos (general collateral repurchase transactions and together collectively regarded as T+2). The upcoming revolution builds on this with the aim of shortening this settlement cycle to T+1, one business day after a trade.

Suggested Citation

  • Yanagawa, Eiichiro, 2018. "Securities settlement revolution in Japan: The future of securities settlement," Journal of Securities Operations & Custody, Henry Stewart Publications, vol. 10(1), pages 45-56, January.
    • Handle: RePEc:aza:jsoc00:y:2018:v:10:i:1:p:45-56
    as

    Download full text from publisher

    File URL: https://hstalks.com/article/4086/download/
    Download Restriction: Requires a paid subscription for full access.
    File URL: https://hstalks.com/article/4086/
    Download Restriction: Requires a paid subscription for full access.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    shorten the settlement cycle; Japanese government bonds (JGBs); securities settlement revolution; central counterparty (CCP); central securities depositories (CSD); repurchase transaction (repo);
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aza:jsoc00:y:2018:v:10:i:1:p:45-56. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Henry Stewart Talks (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.