A Q&A with DTCC’s Rebecca Ashton on Europe’s T+1 Transition and the US Treasury Clearing Mandate

The countdown for the move to T+1 in Europe, UK and Switzerland is on, and with twelve months to go, firms should be well advanced in preparation for the operational impacts of compressed settlement.

In this Q&A with RegTech Insight, Rebecca Ashton, Managing Director and Head of Consulting at DTCC  examines gaps in preparation, the measures that reveal operational weaknesses and lessons from the US transition. We also cover the post-trade operations impacts of the upcoming US Treasury Mandate and longer trading hours.

The UK, EU and Switzerland plan to move to T+1 settlement in October 2027.  Where has preparation advanced – and which parts of the operating model remain least mature?

Across the European markets measured, equity transactions achieved a 98.17% same-day match rate in Q2 2026, compared to 94.12% for fixed income transactions. This four-percentage-point gap underscores that automation and operational standardization remain slightly uneven across asset classes.

While many equity workflows have benefited from years of investment in automation and straight-through processing, fixed income continues to present greater operational complexity, creating additional challenges for trade-date matching. As firms prepare for T+1, closing this gap will be critical to supporting efficient settlement outcomes and reducing operational risk.

In our work with firms preparing for T+1, the focus is evolving beyond matching and confirmation to the quality, governance and accessibility of settlement data. The Financial Markets Standards Board’s core principles for the Sharing of Standard Settlement Instructions (SSI) established market practices intended to improve the quality, consistency and automation of SSI management. This is particularly important under T+1, where compressed timelines reduce the opportunity to identify and remediate SSI issues, making manual processes increasingly difficult to sustain.

Firms should automate the capture, validation and sharing of SSI data wherever possible. Standardised, electronically shared and pre-authenticated instructions can reduce manual intervention, improve straight-through processing while minimising settlement risk.

What separates a funded T+1 programme from genuine operational readiness? Which measures – such as same-day allocation and confirmation rates, standing settlement instruction accuracy, exception ageing and settlement failures – provide the clearest evidence?

Our work with market participants suggests a funded programme is an important starting point because it demonstrates commitment, governance and resources. However, operational readiness, is evidenced by a firm’s ability to complete post-trade processes consistently within a compressed T+1 settlement window during normal conditions as well as periods of higher volume or volatility.

However, firms are only as resilient as the counterparty requiring the greatest remediation. DTCC Consulting Services has begun producing a monthly performance metrics report and readout that assesses improvements at the firm level while also identifying the counterparties with persistent gaps. This counterparty-level view is critical because aggregate performance can mask recurring weaknesses and give firms an incomplete picture of their readiness.

This is significant information to have as many firms do not assess counterparties on a rolling 12-month basis. For example, counterparties can exhibit different trading behaviours over time, a counterparty that underperforms in January may not re-emerge as a concern for several months. Looking across a longer period helps firms determine whether they are prioritising remediation and outreach in the most effective way. In one recent engagement, DTCC Consulting Services helped a large investment bank achieve a 700-basis-point improvement in Trade Date Entry and a 650-basis-point improvement in Trade Date Matching over six months through root-cause analysis, process optimisation and a targeted client outreach programme.

While peer benchmarking can add useful context, the strongest evidence is shown through an operating model that consistently converts high trade-date processing rates and accurate settlement data into low exception backlogs and fewer settlement failures. To achieve this, organizations must take a balanced approach to operational metrics, because no single metric is sufficient on its own. Credibility will be achieved when firms can demonstrate sustained performance over time that is supported by effective escalation, recovery and resilience during volume or volatility spikes with results being comparable across counterparties and service providers.

Where does T+1 place the greatest strain on firms’ controls and accountability? Are manual exceptions, fragmented data or unclear ownership creating risks that project-level readiness reporting may not reveal?

Our assessment is that T+1 has revealed constraints within the operating model where manual intervention, fragmented data and cross-functional handoffs are required to resolve post-trade processing issues. Under T+2, firms had more time to identify discrepancies and source missing information. However, T+1 has reduced the timeframe to address fragmented elements in the reporting process. This means the buffer narrows considerably, exposing control weaknesses that may not be visible in programme-level status reporting.

To resolve these strains, there must be clear ownership in place. In many organisations, responsibility for the different stages of the trade lifecycle sits across middle office, operations, and technology teams. When these instances occur, delays often stem less from the issue itself, but from the uncertainty of ownership and how it should be escalated. For that reason, DTCC Consulting Services would encourage firms to look beyond programme milestones and assess the effectiveness of operational controls, information management and accountability structures. T+1 is not only a test of post-trade efficiency, but it shows whether ownership is clear, exceptions are visible and escalation paths work quickly enough to protect settlement outcomes.

Smaller and mid-sized firms depend heavily on custodians, brokers and technology providers. How should they distinguish between work they control and external dependencies, and which testing milestones should now be non-negotiable? What lessons could these firms learn from the US T+1 transition?

DTCC Consulting Services’ assessment is that T+1 readiness cannot be achieved in isolation. It requires coordinated execution across the post-trade lifecycle, from brokers and custodians to counterparties and even technology providers, with clear accountability for each handoff and dependency.

This is significant for smaller asset management firms in this complex landscape, because their readiness is often heavily reliant on their custodians for settlement processing, market connectivity and local market expertise.

However, firms of all sizes must understand which activities are within their control. Each level has specific dependencies, but more broadly, internal responsibilities may include trading allocation, affirmations, exception management and SSI quality. External remits may involve connectivity, broker workflows, funding arrangements and other post-trade services.

A practical readiness assessment should map where each firm’s responsibility begins and ends, identify critical third-party dependencies and define evidence-based testing criteria. Non-negotiable milestones should include end-to-end workflow testing, volume and stress testing, exception and recovery scenarios, cut-off validation and bilateral testing with key providers and counterparties. One lesson from the U.S. transition is that firms should not compare a provider’s readiness with their own because each organisation must validate how its data, processes and controls perform across the full chain.

Mandatory clearing of eligible cash U.S. Treasury transactions is approaching at the end of 2026. Where are firms encountering the greatest difficulty – clearing access, client onboarding, margin and liquidity, transaction records or exception management – and how could central clearing change their operating models?

Throughout DTCC’s work supporting and advancing the industry amid similar transformations across the post-trade ecosystem, we see the challenge as not a single implementation issue but the interaction among multiple workstreams. Firms are simultaneously evaluating clearing access models, onboarding clients, negotiating legal documentation, preparing for margin and liquidity requirements while adapting their post-trade operating models. A consulting-led readiness assessment can help identify these interdependencies, sequence decisions and surface constraints before they become critical-path issues.

Our analysis points to clearing access and client onboarding being the biggest challenges. Firms must select a direct or indirect access model within a sufficient timeframe to onboard the legal and operational changes required to support it. Additionally, organisations should understand how central clearing will affect day to day processes because expanded mandatory clearing may entail new margin processes, collateral management requirements, and reporting obligations.

DTCC Consulting Services views the transition as an operating-model change rather than a compliance exercise. Firms will need to evaluate how clearing access, margin, collateral, transaction records and exception management work together, then align governance, processes and technology to support the advancement of operating models. We have also witnessed firms prioritising mandate compliance over balance-sheet efficiency. Once the repo clearing deadline has passed, firms should revisit the access, clearing and operating-model decisions made during implementation through a capital-optimisation lens to determine whether they support efficient margin, collateral, funding and balance-sheet outcomes or require further refinement.

T+1, expanded Treasury clearing and the move towards 24/5 trading all compress post-trade timelines. Beyond meeting individual mandates, how can firms use these changes to build a more automated, resilient and capital-efficient operating model?

From a DTCC Consulting Services perspective, T+1, expanded U.S. Treasury clearing, and 24/5 trading are distinct industry initiatives. While expanded Treasury clearing is being driven by rule changes, it has also increased the range of access models available to market participants, giving firms more choice in how they connect to clearing and structure their relationships. Combined, these developments raise the same underlying question of whether firms’ post-trade operating models can keep pace as markets evolve. T+1 demonstrates that modernisation can deliver benefits beyond compliance by shortening the margin period of risk and reducing unsettled activity in the clearing system while still helping lower margin requirements, even during periods of exceptionally high trading volumes. The move towards 24×5 trading further raises the operational bar by requiring firms to support near-continuous processing, liquidity management and issue resolution across time zones, with fewer defined windows for overnight remediation.

We would encourage firms to use these mandates to define a common target operating model and prioritise a transformation roadmap. That means assessing automation, real-time monitoring, operational visibility, scalable infrastructure and liquidity tools as connected capabilities rather than isolated investments. Cross-margining, cloud-based processing and tokenised collateral may help reduce liquidity demands, improve capacity and support funding outside traditional market hours, but the value will depend on disciplined implementation, governance and resilient operating model.

Industry-wide mandates can unlock strategic workflow, data and technology upgrades that might otherwise lose out to shorter-term priorities. How should firms build the business case and measure the lasting impact on revenue, cost, liquidity and risk?

Firms should look beyond the immediate implementation cost and assess the operating model they will retain after the deadline. The business case should connect required change to a clearly defined future state, with baseline measures, targeted benefits, accountable owners and a method for tracking value after implementation. Without that discipline, firms risk supporting new market structures while preserving manual work, operational pressure and avoidable balance-sheet and liquidity inefficiencies.

The business case should therefore track measurable outcomes across revenue, cost, liquidity and risk. Relevant indicators may include processing capacity, exception volumes, manual intervention, settlement failures, margin and balance-sheet efficiency, client-onboarding time and resilience during volume or volatility spikes. The objective is not simply to fund the next mandate, but to build reusable capabilities that reduce operational friction, improve client service and strengthen risk management across future market changes.