Citi Securities Services Evolution 2025

Securities Services Evolution 2025 | 39 Europe T+1’s new global epicenter Europe is seemingly all-in with T+1. 57% of European respondents to this year’s survey cite T+1 as the most impactful change in post trade, the highest single ranking of any region globally. With 29 markets moving to T+1 on the 11th October 2027 (including the multitude of FMIs spanning 38 CSDs, 14 CCPs, and the common settlement platform T2S), the scale and impact of this transition cannot be under- estimated – as the recent publications by the UK 56 and EU 57 T+1 taskforces of their respective implementation plans this year have made clear. Only Switzerland’s plans are now pending finalization, with the Swiss Securities Post Trade Council (swissSPTC) expected to lock down its T+1 implementation plans by September 2025. The alignment of these multiple rule books and implementation plans is seen as a critical first step in the T+1 preparation journey, with 42% of respondents focused on this harmonization as part of their EU transition planning. Given this plethora of implementation plans and markets, the key question in 2025 is how to ensure that this dominant focus (and spend) can be used to drive and accelerate efficiency and innovation – instead of being a mandatory change requirement that simply has to be survived. Based on our survey, 69% of respondents are focused on driving internal automation as part of their T+1 efforts, with 38% also reviewing their agent and CSD relationships across the continent. These grass-roots initiatives look set to have a lasting impact well beyond October 2027. T+1’s twist: Settlement discipline Across all of the respective taskforce reports, the focus on settlement efficiency is clear – and is a notable difference from the North American T+1 plans. Owing to the CSDR Settlement Discipline Regime, European firms have invested heavily in settlement efficiency since 2014 (in an effort to avoid costly penalties that have become core to European settlements) to the extent that much of the required work in this space is already behind most firms. For this reason, European firms have been acutely aware of the trade fail pressures triggered by T+1 to date, with 38% of European respondents seeing their trade fail rates ‘significantly impacted’ by the 2024 US transitions (the highest of any region globally). With ESMA due to respond to the public consultation on the revision of the CSDR regulatory technical standards (RTS) and the European Commission considering ESMA’s technical advice 58 on the scope of the Settlement Discipline Regime (published June 2025), we should expect a renewed focus on settlement discipline and an increasing scrutiny on trade fail pressures as a core component of the 2027 T+1 transitions. Perhaps in anticipation of ESMA’s technical advice and in response to the UK’s T+1 Implementation Plan, 23% of European based respondents are focused on settlement optimization methods such as partial settlement and hold and release and improved lending and borrowing arrangements for the EU and UK (27%). Accelerated settlements Settlement efficiency Replacement of FMI legacy technology platforms Adoption of Generative AI* Adoption of digital assets Increased shareholder participation and governance Automation of asset servicing Mandatory fixed income clearing Resiliency Figure 21: Most significant changes in the European post-trade space today Expressed as: % of respondents in Europe citing each change, excluding others. *New category in 2025. 24% 51% 54% 16% 13% 22% 16% 6% 1% 2% 7% 7% 8% 10% 7% 11% 2% 5% 1% 1% 2023 2024 2025