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T+2 Standard settlement Lifecycle update

T+2 Standard settlement Lifecycle update

Information for Listed companies

On October 6th, 2014 an important change in relation to transactions in securities, including yours, on our Euronext markets will be implements.  On this day the standard period for settlement of transactions on our Euronext markets will go from T+3 to T+2 days.  This change will apply to all cash market securities i.e. equity and fixed income securities.  We have attached a diagram that outlines the existing and the new order of days for corporate actions that are impacted by this.

Our first communication on in relation to this upcoming change was made on May 22nd, 2014 by our ExpertLine team via email (here included in this email).  We will send out further communications prior to this date to remind you that this day is approaching.

What does the change in settlement to T+2 mean for your company?

  • In respect of any type of distribution, for example dividend or coupon payment, the new timetable needs to be taken into account.  You should discuss with your Paying Agent if any changes are required;
  • If a dividend payment date has already been communicated to the market, it is important that issuers are aware of the correct cut of date;
  • It is important that you review your financial calendar and communications to ensure that you communicate the correct dates to the market.

In addition to the above, it is important to note that individual stock options are traded in your stock on our derivative market.  These individual stock options expire several times during the year, mainly on the third Friday of the expiration month, unless this is a national  holiday.  It is important that you are aware of these dates as part of your financial communications strategy.  Announcements, in particular relating to Ex-date and Payment date, can lead to a significant change in the value of these options.

The European Securities and Markets Authority has provided important guidance on the disclosure of information related to dividend policy that should be taken into consideration in light of its treatment under article 6 of the Market Abuse Directive.  The guidance is available here.

Relevant links: ESMA guidance and when your derivatives expire

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