Banks push back on proposal to lengthen CLS cutoff time

Banks have expressed concern at a suggestion that CLS should lengthen its cutoff window for accepting foreign exchange trades for payment-versus-payment (PvP) settlement once the US securities market migrates to T+1 next year.

In the current T+2 structure, securities trades are matched and confirmed in the US at 11.30pm Eastern Time (ET) on the day after the trade, with the FX leg typically done the following day. The trade is then fed into CLS to be settled on T+2.

Under T+1, securities