Bursa to launch T+2 settlement cycle on April 29

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KUALA LUMPUR (April 16): Bursa Malaysia says the T+2 settlement cycle will be launched on April 29, following consultation with relevant industries and stakeholders.

In a statement today, Bursa said the Securities Commission Malaysia has approved changes to the relevant rules on March 26, 2019 to facilitate the move to a T+2 settlement cycle. Market participants have also successfully completed a series of systems testing to ensure a smooth transition prior to the launch, it added.

The migration from a T+3 to T+2 settlement cycle is part of Bursa's ongoing efforts to improve operational efficiency and reduce systemic risk. Under the T+2 cycle, if an investor buys shares on Monday, they will only have to pay for the shares by Wednesday.

According to Bursa, the migration gives the stock exchange the opportunity to educate and inform investors about the settlement cycle and how to effectively use it to enhance their investment and trading of stocks on the bourse.

"Investors will experience a faster settlement process, whereby their trades are cleared and settled two days after the trade day. The shorter settlement cycle will align the clearing and settlement processes of the Malaysian capital market with those of major global exchanges in the US, Europe and Asia-Pacific, which are already operating a T+2 settlement cycle," it said.