Securities settlement revolution: Japanese Government Bonds move to T+1 with the advent of a new repo market

Eiichiro Yanagawa
Additional contact information
Eiichiro Yanagawa: 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

Journal of Securities Operations & Custody, 2017, vol. 9, issue 4, 356-373

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 move is designed to maintain and strengthen the market’s international competitiveness amid the challenge of putting in place a market infrastructure that will enhance the global appeal and convenience of JGBs. Towards this end, it seeks to jettison practices peculiar to the Japanese repurchase transaction (repo) market to harmonise repo transactions with global standards with the aim of creating a new market with new business opportunities. In practice and from a more granular perspective, this means transitioning to so-called shin-gensaki repos, or conditional sale securities repurchase transactions, from so-called gentan repos, or cash-collateralised securities lending repurchase transactions. In addition, the new market is also being designed to help spur greater diversity among market participants.

Keywords: shorten the settlement cycle; Japanese government bonds (JGBs); securities settlement revolution; central counterparty (CCP); central securities depositories (CSD); repurchase transaction (repo) (search for similar items in EconPapers)
JEL-codes: E5 G2 K22 (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations:

Downloads: (external link)
https://hstalks.com/article/571/download/ (application/pdf)
https://hstalks.com/article/571/ (text/html)
Requires a paid subscription for full access.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aza:jsoc00:y:2017:v:9:i:4:p:356-373

Access Statistics for this article

More articles in Journal of Securities Operations & Custody from Henry Stewart Publications
Bibliographic data for series maintained by Henry Stewart Talks ().