The Colombo Stock Exchange (CSE), in consultation with the Securities and Exchange Commission of Sri Lanka (SEC) and industry participants, has announced that the settlement cycle for equity transactions will be reduced from T+3 to T+2 with effect from June 10, 2024 (i.e. trades taking place on and after June 10).
The concept of settlement cycles plays a pivotal role in ensuring smooth and efficient trading processes in the stock market, as it determines when the securities and funds are exchanged between buyers and sellers after a trade takes place, the CSE said in an announcement.
Under the T+3 cycle, fund settlement and security transfer occur on the third market day from the trade date. Transitioning to a T+2 cycle ensures that the securities and funds in relation to all equity transactions will be exchanged between the ultimate buyers and sellers on the second market day from the trade execution date.
Reducing the settlement cycle will create greater efficiencies in the market, including reduction of operational risks, liquidity needs, margin and collateral requirements. The shift would also create opportunities for the growth of investors, as quicker settlements will provide them with faster access to funds, enabling investors to reinvest their funds more efficiently, which will, in turn, enhance market liquidity. This initiative also helps the CSE align with international standards and best practices.
You can share this post!
Content
The funeral of arguably the Queen of the Sinhala cinema Malini Fonseka, will be held with state honours on Monday, May 26, 2025, at the Independence Square.
Kasun, was born in 28th Sept 1964, the grandson of the legendary author and linguist Munidasa Cumaratunga and son of SSP Bindu Kumaratunga and Winifred
Former Sports Minister Mahindananda Aluthgamage and former Sathosa Chairman Nalin Fernando have sentenced to 20 and 25 years respectively after they were found guilty in a case of fraud.
Three Electoral Organisers of the Samagi Jana Balawegaya tendered their resignations.
Leave Comments