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Nigeria’s capital markets are in a period of rapid transformation, marked by a continuous drive for reform. From shortening settlement cycles to extending trading hours, the market’s momentum is palpable. In this latest edition of our “Where Can We Take You” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, speaks to Masha Maharaj, Sub-Saharan Africa Custody Head at Citi, to unpack these upcoming changes.

Where Can We Take You? Nigeria

Stay abreast of key industry developments across the globe and learn more about how we’re supporting clients through these market changes. Wherever you are in your journey, and wherever you’re going, we’ll help get you there.

Where Can We Take You?

Today, more firms of all sizes need local connections and the ability to seamlessly navigate global markets. And they need them now, because they need to be everywhere, ready for anything.So how do you stay prepared?By working with local experts, creating valuable relationships with financial market infrastructures and regulators worldwide, and getting unprecedented access. By having the right tools to analyze data and discover trends that inform your next move.By partnering with Citi and our team of on-the-ground Custody specialists.Our global network covers 99.9% of market capitalization across more than 100 markets which means you’ll have:&nbsp;<ul style="list-style-type:disc;"><li>Unparalleled access to global markets combined with deep local expertise</li><li>A global vantage point to navigate evolving and complex markets with 24/7 monitoring, risk management discipline and local connectivity</li><li>Actionable insights and on-demand market intelligence via our Market Guide platform to drive smarter business decisions</li><li>Our commitment to investing in and exploring new technologies to maximize speed and efficiency</li><li>A champion of industry progress as we continue to actively advocate to harmonize the global post-trade landscape</li></ul>We’re continuously investing in the relationships that power our global network infrastructure. &nbsp;Each month, we will be highlighting key industry developments from around the world to help you stay connected. &nbsp;Wherever you are in your journey, and wherever you’re going, we’ll get you there. &nbsp;

Today, more firms of all sizes need local connections and the ability to seamlessly navigate global markets. And they need them now, because they need to be everywhere, ready for anything.

Welcome to "Where Can We Take You?"

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The Accelerated Settlement Taskforce (AST) has recommended the UK move to T+1 on October 11, 2027, in lockstep with the European Union (EU), Switzerland and Liechtenstein. In this first edition of our “Where Can We Take You?” series, Marcello Topa, Head of Global Market Advocacy, Investor Services at Citi sits down with Chris Brewster, UK Custody Head, Investor Services at Citi, to discuss the UK’s T+1 transition and what market participants should be doing ahead of its implementation.<figure class="table"><table style="background-color:hsl(0, 0%, 100%);border-style:none;"><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Head of Global Market Advocacy Investor Services, Citi</td><td style="border-style:none;"><img class="image_resized" style="aspect-ratio:300/301;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/chris-brewster-citi.jpg" alt="" width="400" height="400">Chris Brewster UK Custody Head Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr><tr><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td></tr></tbody></table></figure> Can you share some of the drivers behind why the UK is adopting T+1? Brewster: The UK’s decision to push ahead with T+1 was partly a defensive play following the rollout of shorter settlement cycles across the Americas. Advocates of T+1 also felt its introduction would help promote UK Plc and showcase the country’s attractiveness as a leading investment destination post-Brexit.What practical steps should market participants be taking ahead of T+1 in the UK? Brewster: The key to a successful T+1 transition is preparation - financial institutions should be using this time to perform gap analysis and identifying any potential weaknesses they may have ahead of the go-live date. Robust systems testing will be critically important, just as it was in the US.&nbsp;More importantly, firms need to have a good understanding of how trades flow from the trading desk through to the back office and to the settlement system. This will enable them to focus on any changes required to the operational processes in order to meet the new cutoff times. In this regard, they ought to start thinking about ways to automate their manual processes and standardize workflows. In parallel, all resource management activities (such as funding, stock borrowing, position realignments) need to be reviewed and tightened where necessary, so that there is sufficient availability of cash and securities to complete the settlement. The good news is that those firms that have gone through the T+1 transition in North America will not be starting this entire exercise again from scratch, although they may need to accommodate for some local UK market idiosyncrasies.What lessons can be learned from the North American T+1 transition experience? Brewster: When the US migrated to T+1, a lot of the impact was around differences in time zones and the implications for firms in Europe and Asia. With time zones being somewhat less of a concern from a UK perspective, there are other concerns including cash funding, FX, lending, operational process and technology upgrades. Communication is also key, not only for domestic investors, but foreign investors and particularly those who only trade UK securities periodically.What role do custodians play in the transition journey?&nbsp; Brewster: Custodians are uniquely positioned to help clients with the transition to T+1. One of our primary roles is to disseminate accurate and timely T+1 information to clients across the entire investment and intermediary chain. We do this by giving them access to on-demand market intelligence and thought leadership via our Market Guide platform. For example, Citi participated in multiple events and webinars with the Depository Trust &amp; Clearing Corporation (DTCC) and The ValueExchange during the US transition to ensure clients were kept abreast of updates. We have now already started to engage with clients to ensure their interpretations of what is happening with T+1 in the UK (and elsewhere) are accurate.&nbsp;However, an important point to note is that although custodians have a major role to play, namely by helping clients understand how shorter settlement cycles will impact their businesses and identifying any processing gaps, it is ultimately the clients’ responsibility to ensure their operations are T+1 ready when the changes take effect.How is Citi helping clients prepare for the UK’s transition to T+1? Brewster: Our global network of over 100 markets covers 99.9% of the world’s market capitalization. Our local presence gives us faster access to what is happening on the ground as it relates to the end investors.&nbsp;Once the UK’s Accelerated Settlement Taskforce (AST) published its final report setting out the implementation details for T+1, we hosted a webinar in March with Andrew Douglas, Chair of the UK AST to provide clients with a comprehensive overview of the regulatory changes, key challenges and necessary preparations required. &nbsp;We are currently reviewing in detail the AST Technical Group report to define a comprehensive implementation plan. Citi’s view is that a coordinated T+1 transition across both the UK and Europe would be beneficial to all parties. With this in mind, we are actively participating in the EU T+1 Industry Committee as the only bank with three co-leads across the 12 workstreams, as well as being represented in the Swiss Securities Post-Trade Council. Following which, we will begin supporting clients with their T+1 implementation and testing requirements for both the UK and Europe.

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In this first edition of our “Where Can We Take You?” series, Marcello Topa, Head of Global Market Advocacy, Investor Services at Citi sits down with Chris Brewster, UK Custody Head, Investor Services at Citi, to discuss the UK’s T+1 transition and what market participants should be doing ahead of its implementation.

United Kingdom and its move to T+1

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Investors often pigeonhole the Nordics as being a single homogenous bloc, but the region’s capital markets are diverse and anything but standardized. In this second edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, sits down with Ola Mjorud, Nordic Custody Country Head, to talk about the upcoming changes and opportunities in the region. &nbsp;<figure class="table"><table style="background-color:hsl(0, 0%, 100%);border-style:none;"><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1633/1585;border-radius:10px;width:31%;" src="/rcs/citigpa/storage/public/Ola_new_resized.png" width="1633" height="1585">Ola Mjorud Nordic Custody Country Head Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr><tr><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td><td>&nbsp;</td></tr></tbody></table></figure><h3>Could you give us an overview of Citi’s presence in the Nordics?</h3>Mjorud: The Nordics are an increasingly popular investment destination, due in part to their sizeable domestic capital markets, with Sweden, for example, being the third largest capital market in the EU after Germany and France. &nbsp;Despite their close geographical proximity, there are a lot of differences between the individual Nordic markets, with Denmark, Finland, Norway and Sweden each having different currencies, two different Stock Exchanges and wholly separate Central Securities Depositories (CSD). &nbsp;Citi established its operations in the Nordics more than 50 years ago. Now, we have the largest presence in region among international banks, especially in terms of our securities services, cash management and execution services businesses. Our primary role is to ensure that our clients have seamless connectivity into the four Nordic markets.<h3>What are some of the important changes happening in the Nordic markets today?</h3>Mjorud: Harmonization is a big theme across the Nordic markets at the moment, and it is being driven by a number of important market developments namely,<ul style="list-style-type:disc;"><li>The move to TARGET2-Securities (T2S) and Target2 (T2)</li><li>The Euronext Convergence Project and CA4U</li><li>The Swedish harmonisation project &nbsp;</li></ul><h3>Can you share what investors can expect with regards to T2S and T2 in the region? &nbsp;</h3>Mjorud: While T2S is live in most of Europe, this is not the case in the Nordics. &nbsp;To date, only Denmark and Finland have joined T2S, while Norway and Sweden remain outside of it. (For context, Euronext operates both the Norwegian and Danish CSDs while Euroclear operates both the Finnish and Swedish CSDs.) Euronext has confirmed that Norway will transition onto the T2S platform by 2030, while the Riksbank, Sweden’s Central Bank, is anticipating the country will start migrating to T2S from around 2030, before completing the process in the mid 2030s.1To prepare for T2S, Sweden is making a number of changes to its CSD settlement model, account model, participant structure and asset servicing model. It will be a major boost for regional and pan-European integration once all of the Nordics are live on T2S. &nbsp;The current priority, however, for Norway and Sweden is to follow the example of Denmark and Finland and move their local currencies onto T2, the real-time gross settlement system operated by the Eurosystem. Sweden is expected to join T2 from 2029, 2 while Norway expects an agreement on participation in T2 to be ready at the end of 2025 at the earliest.3 Once these two countries officially join T2, T2S will be the obvious natural next step. &nbsp;<h3>Can you elaborate on some of the changes that Euronext and Euroclear are making in the region?</h3>Mjorud: As part of its Convergence Project, Euronext is overhauling and modernizing the post-trade infrastructure in Denmark, Norway, Portugal and Italy by moving to a single common platform in order to make its processes more homogenized. &nbsp;Euronext has confirmed that Denmark will be live on the new system ahead of the EU’s introduction of T+1 in October 2027. This will be followed by Portugal, Italy and eventually Norway in 2030, which should coincide with its migration onto T2S. &nbsp;Euronext is also upgrading its corporate action processing system for Denmark and Norway. As part of its CA4U Project, Euronext is harmonizing its asset servicing systems across all of its CSDs whilst also ensuring their compliance with the European Central Bank’s (ECB) Single Collateral Management Rulebook for Europe (SCoRE) standards. &nbsp;In Denmark, certain functionalities of CA4U will be up and running in June 2025, while equities should go live from November. In Norway, the system will be phased in over the course of 2026.Changes are happening in Sweden and Finland too. In 2018, Euroclear Finland successfully migrated to Infinity, a CSD platform which replaced previous multiple legacy systems with a modern, standards-based settlement and safekeeping platform for all assets in the book entry system of Euroclear Finland. Now, Euroclear has announced that the same Infinity system will be rolled out for Sweden. A strategy document outlining those plans is expected in the second half of 2025.Through this deeper integration and harmonization, it will become easier and more frictionless for investors to trade across the Nordic markets.<h3>Are there any particular areas for improvement in the Nordics?</h3>Mjorud: In contrast to other T2S markets, which give participants a choice between Indirectly Connected Party (ICP) and Directly Connected Party (DCP) connectivity, Finland only allows for ICP. &nbsp;An ICP model is when T2S connectivity is facilitated via a CSD’s technical interface whereas a DCP set-up allows users to communicate directly with the T2S platform. &nbsp;Citi is a DCP across all of Europe although Finland is an outlier. Finland has made a lot of progress lately on harmonization, but we would like to see users be given the option to connect to T2S via DCP. &nbsp;Income payments in Finland is another area which needs addressing.Currently, income payments are paid in commercial bank money without the support of the ISO format. We are working with Euroclear Finland to potentially roll out Central Bank money payments with ISO support, a move that would reduce risk, increase automation and enable full reporting from the CSD to its participants, right through to the end client. &nbsp;<h3>How is Citi helping clients navigate these upcoming changes?</h3>Mjorud: Over the last few years, we have seen a handful of regional custodians withdraw from the Nordics, partly because of growing competition but also due to the cost implications of the Central Securities Depositories Regulation (CSDR). &nbsp;With our network as a competitive advantage, we have continued to build our capabilities in the region to support clients. Today, we are the only bank in the Nordics that is a CSD participant at all of the Euroclear CSDs and Euronext CSDs, so we are well-placed to help clients navigate changes at both the country and regional level. We are also only one of two providers able to offer a pan-Nordic custody solution. &nbsp;Citi’s Single Legal Vehicle (SLV) gives clients access to European markets, including the Nordics and the T2S markets, via a single operational hub. Through the SLV, clients can benefit from having single euro account with access to all major markets, leading to balance sheet optimization and netting advantages. &nbsp;And finally, we are actively advocating on behalf of our clients with the CSDs, local industry associations, regulators and tax authorities to address existing market challenges. These efforts are aimed at ensuring that the reforms being pushed through are aligned with market best practices and our clients’ best interests. For example, as part on going dialogue with CSD groups in the Nordics, Citi has shared suggested recommendations that are now being incorporated into various projects. These changes will help automate previously manual-intensive activities and streamline processes across Euroclear and Euronext, ultimately improving reliability and reducing risk. &nbsp;There is no doubt that Citi is uniquely well-positioned to support clients, both now and for the future, across the Nordics.&nbsp;

Investors often pigeonhole the Nordics as being a single homogenous bloc, but the region’s capital markets are diverse and anything but standardized. In this second edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, sits down with Ola Mjorud, Nordic Custody Country Head, to talk about the upcoming changes and opportunities in the region. &nbsp;

Harmonizing The Nordics

<div>Where India has led with shorter settlements, others have followed. &nbsp;When North America took the plunge with T+1 in May 2024, India’s equity market had already been live on T+1 for 15 months.&nbsp; As other markets like the EU, UK and Switzerland prepare to adopt T+1, India has gone one step further by introducing a voluntary T+0 cycle.&nbsp;</div><div>In this third edition of our “Where Can We Take You” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, sits down with Prasanna Jha, India Head of Custody, to talk about the roll-out of shorter settlements, additional post-trade reforms in India, and how Citi is supporting its clients in the market.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1551/1490;border-radius:10px;width:31%;" src="/rcs/citigpa/storage/public/Prasanna_Snap.jpg" width="1551" height="1490">Prasanna Jha India Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h3>Citi has been in India for more than a century now.&nbsp; Can you share a quick overview of its custody operations in the country?</h3>Jha: Citi’s presence in India dates back to 1902. We have been offering cash management, trade and treasury solutions in India for more than 50 years, and post-trade solutions for over 30 years, beginning in the early 1990s when the country first opened up its capital markets to foreign investors.&nbsp; &nbsp; Our local presence and close engagement with domestic regulators mean we are well-positioned to help clients navigate the various nuances of accessing the Indian market, including identifying the access route which is most appropriate for a given transaction, together with the local registration and beneficial ownership requirements.&nbsp;<h3>India was the first major market to move to a T+1 settlement cycle. What happened during the transition, and how did Citi help its clients manage the change?&nbsp;</h3><div>Jha: Shorter settlement cycles bring overall efficiency leading to less settlement duration risk and a freeing up of previously trapped liquidity, which is why - after almost 19 years of operating on T+2 – India chose to shorten its settlement cycle to T+1.&nbsp;&nbsp;The regulator, the Securities and Exchange Board of India (SEBI) phased the changes in slowly. The transition started in February 2022 with the lowest 100 stocks by market capitalization, before the following batch of the next 500 smallest market cap stocks was added on the last Friday of every month, until every listed security was trading on T+1 by the end of January 2023.&nbsp; The whole transition took approximately 11 months and covered more than 5000 listed securities.&nbsp; Early-stage proposals from the Financial Market Infrastructures (FMIs) would have resulted in major changes in the way clients and providers worked, including pre-funding being the standard with trade confirmations happening at 1930HRS on trade date. Following extensive dialogue with SEBI and various FMIs, confirmation deadlines were pushed back to 0730HRS on T+1, giving investors additional time to provide their custodians with the necessary instructions, having completed the full cycle of trade order, namely allocation, middle office matching of trades with Note of Execution (NoE)/ broker Contact Note, and sending instructions to their global and local custodians. This meant that investors in North America and Europe could send trade instructions to their custodians overnight, while those in Asia-Pacific were able to do so in the early morning. &nbsp;This flexibility from SEBI made the move to T+1 much easier for foreign investors.&nbsp;The majority of our clients with portfolio holdings in India trade blue chip securities, so they did not experience T+1 until the final two tranches in December 2022 and January 2023. However, as India is a restricted currency market, investments need to be pre-funded. Over 50% of portfolio investments into India come from the U.S, which has a material time zone difference giving all participants involved a very narrow window to manage the various post-trade processes.<div>Citi worked with both regulators and clients to address the issues around settlement operations, funding and FX, and developed solutions accordingly. Citi also introduced a working shift at 0400HRs to support the early morning confirmation deadlines. This seamless transition was also partly enabled through a well-organized education campaign, involving webinars and client specific consultations.<h3>India has also adopted T+0 ahead of a lot of other markets. How is the process going so far?&nbsp;</h3><div>Jha: In March 2024, SEBI announced it would introduce a beta version of a T+0 rolling settlement cycle on an optional basis, which would run in parallel with T+1. It applied to a limited set of 25 publicly traded securities with a small handful of brokers, and only for trades taking place between 0930HRS and 1330HRS. Initially, this T+0 beta version was only accessible to non-custodian clients, i.e. retail investors. &nbsp;Securities trading on T+0 was priced within a + / - 100 basis points (bp) price range of their T+1 underlying.&nbsp; In the first few days of its operation, we saw nominal (sub $25,000) shares being traded on T+0 by retail investors.&nbsp;After its successful dry-run, SEBI announced it would extend this voluntary T+0 settlement cycle to an additional 500 publicly traded securities, with 100 stocks being added every month end, beginning on January 31, 2025, a process that will conclude by the end of May 2025. &nbsp;Beginning May 2025, optional T+0 will also be made available to institutional investors through their custodians. In addition, block trading will be permitted on a T+0 basis as well.&nbsp;Initially, some clients raised concerns about T+0 potentially causing fragmented price discovery. &nbsp;However, given the general expectation that only a small fraction of the overall trading volume would move to T+0, there is almost no possibility of price fragmentation materializing.&nbsp;The market regulator has always maintained that optional T+0 will continue to function in addition to the existing T+1 cycle and there is no proposal from SEBI that it intends to switch off T+1 anytime soon.&nbsp;<div><h3>How has Citi helped its clients manage T+0?&nbsp;</h3>Jha: Our priority is to make sure that the transition to T+0 for clients is as smooth as it was for T+1. We are doing this by:&nbsp;&nbsp;</div><div><ul role="list"><li data-leveltext="" data-font="Symbol" data-listid="4" data-list-defn-props="{&quot;335551671&quot;:8,&quot;335552541&quot;:1,&quot;335559685&quot;:1080,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}" aria-setsize="-1" data-aria-posinset="8" data-aria-level="1" role="listitem">Leading discussions with FMIs, custodians and brokers to create consensus on the various open items in the planning process with a view to enabling T+0 with minimal changes to stakeholders’ systems.&nbsp;&nbsp;</li></ul></div><div><ul role="list"><li data-leveltext="" data-font="Symbol" data-listid="4" data-list-defn-props="{&quot;335551671&quot;:8,&quot;335552541&quot;:1,&quot;335559685&quot;:1080,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}" aria-setsize="-1" data-aria-posinset="9" data-aria-level="1" role="listitem">Engaging with SEBI, local FMIs and industry bodies, including the Association of Global Custodians (AGC) and the Asia Securities and Financial Markets Association (ASIFMA) to ensure best practices are upheld.&nbsp;&nbsp;</li><li data-leveltext="" data-font="Symbol" data-listid="4" data-list-defn-props="{&quot;335551671&quot;:8,&quot;335552541&quot;:1,&quot;335559685&quot;:1080,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}" aria-setsize="-1" data-aria-posinset="9" data-aria-level="1" role="listitem">Implementing the necessary systems changes, i.e. creating market identifiers to facilitate the correct settlement of a security trading on both T+1 and T+0; ensuring offshore clients have sufficient cash and securities available to support timely FX settlement, etc.&nbsp;&nbsp;</li></ul></div><div><ul role="list"><li data-leveltext="" data-font="Symbol" data-listid="3" data-list-defn-props="{&quot;335551671&quot;:8,&quot;335552541&quot;:1,&quot;335559685&quot;:1080,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}" aria-setsize="-1" data-aria-posinset="8" data-aria-level="1" role="listitem">Testing our systems and processes thoroughly ahead of the go live date on May 1, 2025.&nbsp;</li></ul></div><div><ul role="list"><li data-leveltext="" data-font="Symbol" data-listid="3" data-list-defn-props="{&quot;335551671&quot;:8,&quot;335552541&quot;:1,&quot;335559685&quot;:1080,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}" aria-setsize="-1" data-aria-posinset="9" data-aria-level="1" role="listitem">Educating our clients about the implications of T+0, i.e. through ongoing dialogue, thought leadership articles, etc.</li></ul><div><h3>Are there any other upcoming market changes happening in India?</h3>Jha: Quite a number in fact. For example, India will consolidate its Contract Note/ NoE format starting from the end of April 2025.&nbsp; India has multiple stock exchanges, including the BSE and NSE, but there are times when an investor may be trading the same security on both exchanges, and getting a different price. Not only is the investor not getting best value or best execution, but this also means there are multiple trade allocations happening across the exchanges. As a result, an increased number of transactions have to be recorded, multiple Contract Notes/NoEs need to be matched with orders, and custodians receive double the number of instructions.&nbsp;By issuing a single Contract Note across multiple exchanges, the volume weighted average price (VWAP) for the same security traded across exchanges will be recorded once, so investors will get the best value and benefit from best execution. It also means they will only have to send one instruction to their custodian.&nbsp; From a Citi standpoint, our systems have been updated and are ready to handle these changes as and when they take effect.&nbsp;As India continues with its ambitious reform journey, we advise clients to stay tuned for further updates.&nbsp;&nbsp;</div></div></div></div></div></div>

In this third edition of our “Where Can We Take You” series, we explore the roll-out of shorter settlements in India, additional post-trade reforms and how Citi is supporting its clients in this market.&nbsp;

Navigating India's T+0

<div>South Korea’s regulators have been exceptionally busy lately. After rolling out a series of investor-friendly reforms, the country is now on the verge of being added to FTSE Russell’s flagship bond index.</div><div>In this fourth edition of our “Where Can We Take You” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, is joined with Hyun-Hee Kim, South Korea Custody Head, to talk about South Korea’s sweeping transformation and its imminent bond market index inclusion.&nbsp;<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:699/678;border-radius:10px;width:30.72%;" src="/rcs/v1/media/citigpa/akpublic/storage/retrieveMediaFile/6830703b5472ac0b059fb5d7.png" alt="Hyun-Hee Kim from Citi headshot." width="699" height="678">Hyun-Hee Kim South Korea Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h3>South Korea’s regulators have doubled down on their reform efforts. How are they making the market more accessible to foreign investors?&nbsp;</h3>Kim: Global investors have historically been underweight South Korean securities in their asset allocations, primarily because the market was not that easy to access or navigate. Local regulators have since tried to remedy this by introducing a number of positive measures, aimed at making the market less restrictive for foreign investors. &nbsp;To put the scale of South Korea’s recent reform efforts into perspective, some of our clients are saying that the country has seen more regulatory change in the last two years than in the last two decades. One of the biggest developments was the decision taken in 2023 by the local regulator, the Financial Services Commission (FSC), to abolish the foreign investors’ registration requirement. This provision, which had been in place since 1992, obliged foreign investors to pre-register with the Financial Supervisory Service (FSS), a separate regulatory body, and obtain an Investment Registration Certificate (IRC) as part of the account opening process. Under the new regime, a foreign individual investor can open up an account at a local custodian or broker by providing just their passport number, or Legal Entity Identifier (LEI), in the case of a corporate investor. &nbsp;Since the IRC submission provisions were scrapped, the number of new account openings by foreign investors has skyrocketed, and is currently averaging around 300 – 400 each month, a sharp increase from 2023, when that monthly average stood at just 105.1&nbsp;<h3>What else are regulators doing to make markets more accessible to foreign investors?</h3><div>Kim: The FSC has eased some of the reporting requirements for foreign investors with omnibus accounts. Instead of having to report information about transactions at the time of settlement, i.e. T+2, investors can now provide this information to the FSS on a monthly basis. &nbsp;This was something which Citi repeatedly advocated for during its conversations with regulators.&nbsp;New corporate transparency standards are being adopted in the country too. &nbsp;It will now become mandatory for large KOSPI-listed companies to provide English language versions of any material disclosures which they make to the Korea Exchange. Previously, this information was only available in Korean, making it challenging for foreign investors.Regulators have also made changes to boost foreign investor participation in the onshore FX market. In July 2024, the local FX market was opened up to registered financial institutions (RFIs), i.e. foreign banks, allowing them to carry out deliverable interbank and USD/won spot, forward and swap trades onshore. 2 In addition, the won’s trading hours were extended from 0900HRS – 1530 HRS to 0900HRS-0200HRS the following day, giving overseas investors more time to trade onshore FX. &nbsp;And finally, South Korea’s short selling rules have been updated. The country has a long track record of imposing arbitrary short selling bans, usually in response to market volatility or concerns about naked short selling. The latest ban, introduced in November 2023, was lifted in March 2025 following the rollout of a Naked Short Selling Detecting System, a new mechanism designed to prevent naked short selling in real-time. 3&nbsp;<div><h3>How is Citi helping its clients manage the various changes in South Korea?&nbsp;</h3><div>Kim: We play a vital role bridging the gap between clients and regulators in South Korea, sharing timely market developments with clients, whilst simultaneously communicating client feedback to the authorities, including the FCS, FSS and the Ministry of Economy and Finance, together with local financial market infrastructures (FMIs), on a regular basis. &nbsp;One of our main differentiators is the sheer size of our network, which gives us unparalleled insights into the best practices being adopted across different markets.We have been active in helping our clients navigate the changes in South Korea. For example, at the point when foreign investors were no longer obliged to obtain an IRC, it became clear that a new account opening form would be required. Without a standardized registration form, investors would have been forced to submit a new form every time they open up an account at a different custodian or broker. Such an outcome would have led to all sorts of inefficiencies.&nbsp;To prevent this from happening, Citi collaborated with the Korean Financial Investment Association (KOFIA), to create a standardized account opening form, which has made life easier for investors when accessing the market through multiple brokers or custodians. &nbsp;<div><h3>The reforms have not gone unnoticed by index providers. How will index inclusion impact South Korea? &nbsp;</h3>Kim: Index providers are taking note of the changes in South Korea, and rightly so. &nbsp;In 2024, FTSE Russell announced that South Korea would be added to its World Government Bond Index (WGBI), with inclusion being phased in over an eight-month period in eight equal monthly tranches, between April 2026 and November 2026. &nbsp;South Korea is expected to be given a 2.05% weighting in the WGBI, making it the ninth largest weighting among the included countries, and putting it just behind Spain and the UK. 4 WGBI inclusion will provide South Korea with a much-needed liquidity boost, with $56 billion from foreign investors expected to enter the country as a result.5Despite the WGBI inclusion, South Korea is still categorized as an Emerging Market by MSCI, and not a Developed Market even though the country has a lot of developed market characteristics. According to MSCI, the main reason for this was because of South Korea's short-selling ban, which has since ended. Whether or not MSCI upgrades South Korea to Developed Market status is yet to be seen.As South Korea pushes through its ambitious reform agenda and index providers take notice of the country’s potential, Citi is well positioned to support its clients every step of the way.</div></div></div></div></div>

1&nbsp;FSC – June 21, 2024 –&nbsp;<a href="https://www.fsc.go.kr/eng/pr010101/82511" target="_blank" rel="noreferrer noopener">Market access improved for foreign investors with abolishment of Investment Registration Certificates</a>&nbsp;&nbsp;2&nbsp;FX Markets-&nbsp; December 19, 2023 –&nbsp;<a href="https://www.fx-markets.com/regulation/7949154/banks-rush-to-register-as-korean-onshore-fx-market-opens-up" target="_blank" rel="noreferrer noopener">Banks rush to register as Korean onshore FX market opens up</a>&nbsp;3&nbsp;S&amp;P Global – April 24, 2025 –&nbsp;<a href="https://www.spglobal.com/marketintelligence/en/mi/research-analysis/from-ban-to-boom-how-south-korea-learned-to-love-short-selling.html#:~:text=South%20Korea's%20financial%20markets%20have,%2C%202025%2C%20after%2016%20months." target="_blank" rel="noreferrer noopener">From ban to boom: How South Korea learned to love short selling again</a>&nbsp;4&nbsp;Ministry of Economy and Finance – April 9, 2025 –&nbsp;<a href="https://english.moef.go.kr/pc/selectTbPressCenterDtl.do?boardCd=N0001&amp;seq=6140" target="_blank" rel="noreferrer noopener">Korea’s inclusion in the FTSE Russell World Government Bond Index is confirmed for full inclusion by November 2026</a>&nbsp;&nbsp;5&nbsp;Bloomberg – April 8, 2025 –&nbsp;<a href="https://www.bloomberg.com/news/articles/2025-04-08/ftse-sees-south-korea-inclusion-in-bond-index-by-november-2026" target="_blank" rel="noreferrer noopener">FTSE delays Korea inclusion in major bond gauge by 5 months</a>&nbsp;

In this fourth edition of our “Where Can We Take You” series, Hyun-Hee Kim, South Korea Custody Head discusses South Korea’s sweeping transformation and its imminent bond market index inclusion.

Where Can We Take You? South Korea

<div>Sweeping market reforms are transforming Brazil, as local regulators and Financial Market Infrastructures (FMIs) make significant changes to the country’s proxy voting, corporate actions and securities lending frameworks.&nbsp;</div><div>In this fifth edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, sits down with Gabriela Kruter, Interim Brazil Custody Head, to discuss the latest market reforms, and how Citi is supporting its clients.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1164/1079;border-radius:10px;width:32.09%;" src="/rcs/v1/media/citigpa/akpublic/storage/retrieveMediaFile/6841d553dc42540b09188e89.jpg" alt="Headshot of Gabriela Kruter" width="1164" height="1079">Gabriela Kruter Interim Brazil Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h3>Citi has been in Brazil for over 100 years now. Can you share a bit of our history in this market?</h3>Kruter: Right, in fact we are celebrating 110 years this month! We were also the first bank in the market to provide securities services to international investors in the early 1990s. We are the leading provider of international custody in Brazil, a position we’ve held for close to two decades now. As of April, we are the custodian for ~61% of all foreign portfolio investment (FPI) assets1 in Brazil. We are actively advocating on behalf of our clients and play an important role in shaping market policy discussions with regulators and FMIs alike.&nbsp;<h3>Brazil introduced changes to its proxy voting regime recently. What exactly changed and what role did Citi play here?</h3><div>Kruter: Citi has spent time making the case for proxy voting reform in Brazil, a practice which historically was laden with inefficiencies and costs. Until fairly recently, investors were required to instruct a lawyer with power of attorney (POA) privileges to physically attend and vote at shareholder meetings on their behalf. In addition, foreign investors also had to demonstrate their proof of shareholder status, a document-heavy undertaking involving a lot of translation work and registrations.2We lobbied for the proxy voting process to be streamlined. After a series of positive discussions with the Brazilian Securities and Exchange Commission (CVM), the regulation on Remote Voting was issued and the Remote Voting Card (RVC) was introduced for proxy voting purposes in 2017.&nbsp;The RVC can be submitted by investors to their custodians, effectively mirroring the same intermediary chain already used by investors to process other corporate events like dividend distribution, etc. Not only does this allow investors to exercise their voting rights remotely, it also significantly reduces their costs, and lowers the participation barriers in shareholder meetings.3From inception, in order to adapt to the requirements of remote voting and to process the increased volume of remote votes being sent to us by clients, we had to make major improvements to our own systems and technology stacks.By eliminating the need for costly and bureaucratic annual renewals of POAs, these changes have enhanced the proxy voting experience for FPIs, moving participation rates at meetings from 71% in 2016 to 76% in 2017.4 In 2016, over 30% of all vote rejections were due to a lack of POA, whereas, in 2025, there have been almost zero vote rejections for that same reason.<div><h3>While the remote voting reforms in Brazil were a welcome development, Citi felt improvements were still needed. Could you elaborate on this?</h3><div>Kruter: Despite making remote voting mandatory for all listed companies, it was clear improvements were still required. The first problem we encountered was that remote voting was not initially available for all meetings, so investors – in certain circumstances – still needed to have a POA framework in place if they wanted to vote. Another snag was that investors were obliged to submit their votes to the custodian seven days before the meeting, which presented a more challenging deadline than the physical attendance process, which usually takes place two days before a meeting.&nbsp;We provided constructive feedback to local regulators on these issues and others reinforcing the relevance of remote voting for international investors and its impact on the governance of local companies. In 2024, the CVM issued a new regulation, making remote voting mandatory for all meetings. The new regulation also allowed investors to submit their votes four days ahead of a shareholder meeting, reducing the cut-off by three days.<div><h3>Corporate action reforms are underway. Specifically, ISIN issuance practices have been changed and there is a general push towards standardization. What is the latest here and could you tell me about Citi’s role?</h3>Kruter: Citi has been advocating for corporate action reform in Brazil as the current process is complex. Existing regulations also give market participants a lot of wiggle room in terms of how they can interpret the rules. One way we found to enhance the process and accelerate the issuance of ISINs was to work with B3. B3 is Brazil’s primary stock exchange and CSD and the only institution authorized to issue ISINs in the country. If an ISIN is not yet issued at the point when a corporate action is announced, then this can lead to delays in the creation of the event by the custodian and that impacts the timing in which clients receive the event notification. Following conversations with B3, they agreed to issue ISINs earlier to enable asset registration to happen before corporate actions take place. This has made the corporate action process in Brazil much smoother for market participants.We are also currently in discussions with B3 about the need to harmonize corporate actions through the adoption of global standards. In addition to facilitating harmonization, this will also lead to better data accuracy and straight-through-processing (STP), all of which will make corporate actions more seamless for end investors and intermediaries.<h3>Citi has also been working with local FMIs to improve securities lending practices. Please provide some insights here.</h3>Kruter: &nbsp;Securities lending in Brazil is fairly unique relative to other markets. This is because the Central Bank of Brazil (BCB) and CVM demand that all securities loans be cleared at a CCP. In other words, when lending securities in Brazil, a borrower’s collateral must be held at the CCP. This is not at all popular with lenders like global fund managers and asset owners as it does not give them quick access to collateral in the event of a borrower default. As a result, some investors choose not to lend out securities in Brazil while others face regulatory restrictions to do so.Together with B3, we have discussed possible alternative models with lending agents and investors. As a result, B3 is sending a proposal to the BCB asking for the rules around securities lending to be adjusted, by moving to a more bilateral securities lending model, whereby collateral is held between the trading counterparties themselves and not only at the CCP. Once the regulator reviews and replies on the request, the market will want to move quickly to adapt and offer new securities lending&nbsp;models to investors.&nbsp;Meanwhile, we have been actively involved in driving reforms aimed at making the local securities lending market more efficient. This comes following analysis performed by B3, which revealed that 70% - 80% of securities out on loan in Brazil were renewed at the market rate on the renewal date. This meant that investors had to instruct their brokers and custodians&nbsp;every single time they wanted to renew their loans even if they wanted to maintain the exact same market rates.&nbsp;In response, B3 enacted changes allowing securities loan contracts to be renewed automatically. As a result, market participants no longer need access to B3’s systems when renewing loan contracts, making the whole process more streamlined. At a time when revenues and margins are under pressure, incremental operational improvements like these provide a much welcome respite.<h3>Looking ahead, what should clients be thinking about in Brazil?</h3>Kruter: As more major markets are moving to T+1, discussions are also underway in Brazil. The target date announced by B3 is February 2028.&nbsp;Although T+1 will help Brazil synchronize itself with other global markets and remove some of the friction faced by dual listed securities and Brazilian Depository Receipts linked to Europe and North America, the transition will also create challenges. Brazil is a pre-funded, beneficial ownership market. This means that market participants will need to rethink the logic behind the allocation and settlement processes as a whole, as it will not be possible to simply compress the current windows like we did when moving from T+3 to T+2 some time ago. Having gone through similar migrations in India and North America, Citi is well-placed strategically to help clients with any upcoming transitions.</div></div></div></div></div>

1 ANBIMA, April 2025&nbsp;2 <a href="https://www.issgovernance.com/file/policy/active/americas/Brazil-Remote-Voting-Card-FAQ.pdf?v=1" target="_blank">ISS – Brazil Remove Voting Card FAQ&nbsp;</a>3 <a href="https://www.issgovernance.com/file/policy/active/americas/Brazil-Remote-Voting-Card-FAQ.pdf?v=1" target="_blank">ISS – Brazil Remove Voting Card FAQ&nbsp;</a>4 Citi Brazil

In this fifth edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, sits down with Gabriela Kruter, Interim Brazil Custody Head, to discuss the latest market reforms, and how Citi is supporting its clients.

Where Can We Take You? Brazil

<div>A decade now in the making, Spain’s capital market reforms are finally coming into fruition.In this edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, talks to Manuel Pineda, Southern Europe Custody Head, Investor Services, Citi, about how Spain is harmonizing its capital markets with the rest of Europe, and Citi’s role in the process.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1370/1181;border-radius:10px;width:33.67%;" src="/rcs/v1/media/citigpa/akpublic/storage/retrieveMediaFile/6866a10103a90e249b58b6a1.jpg" alt="Manuel Pineda" width="1370" height="1181">Manuel Pineda Southern Europe Custody Head, Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h3>Spain has been reforming its capital markets for almost 10 years now. What has changed?</h3>Pineda: It has been an exceptionally busy time for us in Spain lately! Over the last ten years, regulators have rolled out three major market reform initiatives. Everything kickstarted in 2016 when the first reform (Reforma 1) established a Central Counterparty Clearing House (CCP) – BME Clear – together with a new equity settlement system – ARCO – to overhaul the country’s incumbent securities registration system. Previously, Iberclear, the Spanish Central Securities Depository (CSD) used a Registry Reference System (RRS) to identify and track securities transactions from the point of trade execution right through to settlement,1 but it was operationally very complex. One of the biggest changes under Reforma 1 was the roll out of a segregated account structure at the CSD level, giving clients enhanced functionality and cutoffs, and reducing the risk of asset co-mingling – a change that Citi was actively pushing for at the time.Citi enhanced its operating model during the implementation of Reforma 1, as the country’s equity market was undergoing a transformation. Citi understood the benefits of the new on-exchange model and offered tailor made solutions for clients helping their back offices navigate the changes accordingly. We also advocated for the introduction of the Financial Intermediary Account (SIFA) for broker dealers. The SIFA helps international, non-resident broker dealers with the management of registration names. It did this by allowing the accountholder to clear and settle on-exchange trades in their own registration name and settle the client-side trade in the counterparty’s registration name, without having to re-register the shares.&nbsp;This was followed shortly afterwards in 2017 by the second reform (Reforma 2). In anticipation of the roll out of Target2Securities (T2S), a pan-European platform facilitating securities settlement in Central Bank money, Reforma 2 harmonized Spain’s fixed income settlement system by incorporating it into ARCO alongside equities, before then migrating it onto T2S.2 These changes enabled Spain to align itself more closely with the rest of Europe on T2S.<h3>More recently, we have seen the introduction of the third reform (Reforma 3). What does this entail for the Spanish market.</h3><div>Pineda: Reforma 3 started to take shape in 2021, and like the previous two reforms, it is part of Spain’s ongoing efforts to harmonize local market practices with those in Europe. Most significantly, Reforma 3 abolishes the Post Trading Information (PTI) system. This means CSDs no longer need to use the PIT as an information system and the requirement to link registration management with the settlement process is removed.3&nbsp;Additional initiatives to ensure closer Spanish alignment with T2S markets are also in flight, and Citi together with the local FMIs and regulators is playing an active role in their development and roll out. Notable changes here include updates to the Party 2 field, i.e. the European standard for matching criteria. Under the changes, Spain’s use of Party 2 (buy/sell) will now follow the T2S standard, so client information – instead of the registration name – will be entered into the Swift instruction fields. This will help avoid settlement mismatches between counterparties. In addition, firms will also be required to use T2S trade types, i.e. TRAD, to further facilitate harmonization between Spain and the rest of Europe. As there will be no linking and end of day sweeps, SIFAs will no longer be used either, and will instead become regular standard accounts.&nbsp;The law also includes a legal change of great importance for our clients. The market now recognizes that even though holdings are registered in the name of the global custodian, they belong to the underlying clients (global custodian role recognition). In other words, the rules explicitly recognize custody of securities through a chain of intermediaries.4 The person who appears legitimate in the entries in the accounting record will be presumed to be the legitimate owner of the securities and, consequently, may require the issuing entity to provide the benefits to which the negotiable security entitles it.&nbsp;<div><div><div><h3>Citi has been instrumental in driving these changes and supporting clients along the way. What exactly have you done?</h3>Pineda: As a leading custodian in Spain, we have been incredibly active in both driving these reforms forward and supporting our clients with the changes. We have collaborated with regulators, investors and stakeholders over the last decade to ensure a responsible and reasonable outcome which benefits everyone and keeps disruption to a minimum. This has been done through active participation in industry working groups and one-on-one meetings with the various stakeholders.&nbsp;In the lead-up to Reforma 3, we provided our clients with extensive support, which was highly tailored according to individual needs and requirements. This meant we spent a lot of time educating clients about what the changes would mean for their businesses, often through webinars and bespoke training sessions. We also helped clients leverage automation to optimize their processes and reduce manual intervention ahead of the changes.<h3>Reforma 3 has facilitated a lot of market-wide efficiencies, as has Citi. What are you seeing exactly?</h3>Pineda: The implementation of Reforma 3 has been a great success. For instance, in Spain, we have seen a notable improvement in overall settlement efficiency, with rates increasing from 95.96% to 96.14%5 post-reform.&nbsp;Having helped clients understand what the new rules meant and delivered on automation, the strategic benefits are becoming increasingly clear. Immediately after its implementation in Spain, we saw an 85% reduction in manual touchpoints thanks to clients’ operations being streamlined. Client satisfaction levels are also rising, evidenced by the 54% decrease in client inquiries, demonstrating their growing comfort and better understanding of the new processes.&nbsp;Our presence and deep pool of subject matter experts across Southern Europe means we are strategically well-positioned to support clients with market changes in Spain, and elsewhere.</div></div></div></div></div>

1 <a href="https://www.bolsasymercados.es/en/blog/what-is-reforma-3.html#reforma-3:-modernization-of-post-trade-in-spain" target="_blank">BME – What is Reforma 3?&nbsp;</a>2 <a href="https://www.bolsasymercados.es/en/blog/what-is-reforma-3.html#reforma-3:-modernization-of-post-trade-in-spain" target="_blank">BME – What is Reforma 3?&nbsp;</a>3 <a href="https://www.bolsasymercados.es/en/blog/what-is-reforma-3.html#reforma-3:-modernization-of-post-trade-in-spain" target="_blank">BME – What is Reforma 3?&nbsp;</a>4 <a href="https://www.bolsasymercados.es/en/blog/what-is-reforma-3.html#reforma-3:-modernization-of-post-trade-in-spain" target="_blank">BME – What is Reforma 3?&nbsp;</a>5 Source: Citi&nbsp;With Reforma 3, the process introduced by this new account will be maintained, although we will see how the requirements will be simplified, so it can be said that the SIFA account disappears to give way to an individual account that will keep the spirit of the SIFA account.

A decade in the making, Spain’s capital market reforms are finally coming into fruition. Manuel Pineda, Southern Europe Custody Head for Citi Investor Services, discusses the three major market reform initiatives in Spain that aims to harmonize local market practices to align with the rest of Europe.&nbsp;

Modernizing Spain's Post-Trade Infrastructure

<div>Post-trade reform in Hong Kong is happening at a relentless pace as local regulators and Financial Market Infrastructures (FMIs) take aim at proxy voting, asset safekeeping and trade settlement practices.</div><div>In this fifth edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, speaks with Amit Raghunath, Hong Kong Custody Head, about these changes, and how they are impacting the local market. &nbsp;<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:2760/2563;border-radius:10px;width:30.59%;" src="/rcs/v1/media/citigpa/akpublic/storage/retrieveMediaFile/6870228fddbbf62e62315f70.jpg" alt="Amit Raghunath" width="2760" height="2563">Amit Raghunath Hong Kong Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h3>Proxy voting reform has been an intense area of focus in Hong Kong. What exactly is happening?</h3>Raghunath: It certainly has! A long-standing challenge in Hong Kong – until fairly recently – was that proxy events did not have a mandatory record date. Typically, it is a fairly standard market practice for issuers to set a record date either one or two days before a proxy voting deadline or ahead of receiving entitlements. However, if there are multiple proxy events without a mandated record date, this could lead to multiple reconciliations and eligibility revisions, creating operational challenges for issuers, intermediaries and investors alike. Together with the Asia Securities Industry &amp; Financial Markets Association (ASIFMA), we flagged some of these challenges to Hong Kong Exchanges &amp; Clearing LTD (HKEX), who have since taken decisive action.In December 2024, HKEX published its <a href="https://www.hkex.com.hk/-/media/HKEX-Market/News/Market-Consultations/2016-Present/June-2024-Review-of-CG-Code/Conclusions-Dec-2024/cp202406cc.pdf" target="_blank">Review of Corporate Governance Code and Related Listing Rules</a> – confirming that from July 1, 2025, issuers must set a record date for proxy voting and when receiving entitlements. These changes will provide investors and their custodians additional time during the proxy voting process, which will help address some of the operational inefficiencies, i.e. by reducing the number of reconciliations, revisions of eligibility and revised instructions.&nbsp;<h3>Other meaningful market changes are taking place in Hong Kong too. Could you provide some insights into these?</h3><div>Raghunath: There are quite a few reforms in the pipeline! Let’s start with the Uncertificated Securities Market (USM) initiative. In Hong Kong, some investors, i.e. those not trading securities electronically on HKEX, are issued paper certificates denoting ownership of securities. Not only does this fall short of best practices around asset safekeeping, but it also means that the process of transferring the legal title is very time-consuming, often taking up to 10 business days. The Hong Kong Securities and Futures Commission (SFC) is now making it compulsory for investors to hold prescribed securities in their own names and in uncertificated form, thereby giving them direct legal ownership of their securities electronically1 , using platforms operated by approved securities registrars and connected to Hong Kong Securities Clearing Company Limited (HKSCC).From early 2026, all new issues will need to be paperless, i.e. electronic, while for existing securities, issuers must take various steps to allow investors to make the conversion. The USM initiative will give investors better protection, facilitate more efficient trading, and drive better automation across the intermediary chain.&nbsp;Industry engagement has been a big priority for us. We have collaborated with HKEX and the registrars on the new flow design. We are also adapting our systems and processes, so that we can support clients with the changes. For instance, at some point, HKEX will stop providing immediate credit options to custodians. These credit options were available even in scenarios when HKEX had not verified whether the certificates and related documents were accurate. This old model created an element of risk for custodians, as investors could sell their shares immediately, but if an issue was discovered, it was the custodian’s responsibility to return the shares to HKEX. From now on, investors will need to deposit their certificates in advance before selling on their shares. If investors want to sell shares quickly, they will need to use the registrar express service, which carries a few extra charges. In short, the USM increases operational efficiency between the custodians, the registrar and HKEX and reduces risk for all parties.<div><h3>We understand there are quite a few structural changes happening in the world of multi—counter eligible securities. Please elaborate on this.&nbsp;</h3><div>Raghunath: HKSCC is streamlining the settlement process for multi-counter eligible securities, e.g. dual counter securities (DCS) and multi-counter Exchange Traded Funds (ETFs) in the Central Clearing and Settlement System (CCASS).This comes after HKEX received feedback from market participants about the Dual Counter Model, a new mechanism introduced in 2023 which allows investors to trade Hong Kong listed securities in either HKD or RMB. In particular, investors were not satisfied with the inter-counter transfer model for DCS as clearing and settlement were performed separately for each trading counter under a Dual Tranche Dual Counter model, requiring manual conversion from a systems perspective and separate ISINs for their operation.2In June 2025, HKSCC adopted a single tranche multiple counter arrangement for multi-counter eligible securities in CCASS. This allows trading in these products to become more scalable, whilst also eliminating the need for both inter-counter transfers of multi counter eligible securities in CCASS and multiple ISINs. To support clients, we are helping them convert the stock codes on all of their positions and outstanding trades. We have also worked closely with our fund administration colleagues to provide solutions for fund clients when calculating NAVs for different counters.&nbsp;<div><h3>Settlement efficiency does seem to be a strategic priority for market participants in Hong Kong. What have been the big developments here?</h3>Raghunath: In response to growing client demand for faster settlements, i.e. to support efficient collateral management and expeditious trade settlement confirmation for reporting purposes, we made a number of improvements to our post-trade instruction and settlement processing capabilities. In 2023, we went live with a <a href="https://www.citigroup.com/global/news/press-release/2023/citi-unveils-new-automated-settlement-solution-in-hong-kong" target="_blank">new automated settlement solution</a> in Hong Kong. By having a robotic process automation (RPA) module that connects directly with CCASS, clients were able to benefit from automation, and real-time settlement status updates, resulting in timelier and more efficient settlements, together with enhanced operational resilience.As with many markets, Hong Kong is working towards a T+1 settlement cycle, but the precise date for its implementation is yet to be publicly confirmed. HKEX has advised that its post-trade systems will be technically ready to support a T+1 settlement cycle by the end of 2025, although this will not impact market operations or require any action from clients for now. They have recently published a discussion paper “<a href="https://www.hkex.com.hk/News/Market-Communications/2025/250716news?sc_lang=en" target="_blank">Accelerated Settlement for the Hong Kong Cash Market</a>”, looking at the potential implications of T+1. The paper outlined the benefits and challenges of T+1 and invited the industry to provide any feedback to HKEX.Citi has extensive experience with helping firms navigate the T+1 transition, i.e. FX/securities lending support, provision of credit lines, supporting the streamlined ETF creation and redemption process, etc, in India and more recently in North America. Together with our automated settlement solution and real-time tracking of trade matching capabilities in Hong Kong, we are well-positioned to assist clients in the local market, as and when T+1 takes shape.</div></div></div></div></div>

1 HKEX – <a href="https://www.hkex.com.hk/Services/Settlement-and-Depository/USM?sc_lang=en" target="_blank">Overview: USM</a>2 HKEX – <a href="https://www.hkex.com.hk/-/media/HKEX-Market/Services/Clearing/Securities/What_s-New/Single-Tranche-Multiple-Counter-Settlement-Model/STMC_FAQ_Eng.pdf" target="_blank">Enhancement of Settlement Arrangement for multi-counter Eligible Securities - adoption of single tranche multiple counter arrangement - FAQs</a>

As regulators and financial market infrastructures in Hong Kong transform proxy voting, asset safekeeping and trade settlement practices, what are some of the implications to the local market? &nbsp;Amit Raghunath, Hong Kong Custody Head for Citi Investor Services discusses these reforms, how Citi is advocating for our clients and helping them navigate these changes.&nbsp;

 Hong Kong - A Myriad of Changes

<div>Reform zeal is sweeping through Greece at a furious pace, as the country makes wholesale changes to its clearing, settlement and taxation regimes. Marcello Topa, Head of Global Advocacy for Investor Services at Citi, sits down with Manuel Pineda, Southern Europe Custody Head, Investor Services, Citi, in this latest edition of our “<a href="https://www.citigroup.com/global/insights/where-can-we-take-you">Where Can We Take You</a>” series, to talk about some of the transformations that are re-shaping Greece’s capital markets.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1370/1181;border-radius:10px;width:34.24%;" src="/rcs/v1/media/citigpa/akpublic/storage/retrieveMediaFile/6866a10103a90e249b58b6a1.jpg" alt="Manuel Pineda" width="1370" height="1181">Manuel Pineda Southern Europe Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure>We have been seeing quite a number of improvements at AthexCSD recently. Could you share some examples?Pineda: There is a lot happening at AthexCSD! First, AthexCSD is embracing SWIFT connectivity, in line with internationally accepted best practices. In 2023, AthexCSD incorporated the SWIFT ISO20022 messaging format when transmitting information about General Meetings across the intermediary chain, bringing further synergies to the corporate action lifecycle.One year later, AthexCSD confirmed it would introduce SWIFT connectivity to automate the OTC instruction process, allowing for Straight-Through-Processing (STP) settlements to be realized.&nbsp;Second, and more recently, AthexCSD is working on delivering heightened optimization during trade matching, which is something that Citi has also advocated for. If trade matching can happen at a beneficial owner level, then this will result in additional STP gains in the trade instruction process. We anticipate these trade matching enhancements will go live at the end of September 2025, AthexCSD’s Rulebook has already been accordingly updated.There have also been a lot of tax reforms in Greece lately. Tell me about them.&nbsp;<div>Pineda: Tax reform is a strategic priority for the Greek government right now, and we have seen a number of positive changes over the last 12 to 18 months. In 2024, the Ministry of Finance reduced the sales tax on Greek-listed securities from 0.2% to 0.1%, ushering in lower transaction costs for our clients. The Ministry of Finance then followed this up by scrapping the 0.2% levy on securities lending transactions. By making securities lending more economical, the market will become increasingly competitive and liquid, and at the same time help facilitate better price discovery.&nbsp;In 2025, the government reduced the withholding tax paid by Greek-resident investors, i.e. individual investors, on dividends accrued from listed corporate bonds from 15% to 5%.Citi advocated for these changes, and while they are positive, we believe more work still needs to be done. In particular, greater harmonization between the tax rates paid by Greek and non-Greek resident investors will help to simplify the investment process.&nbsp;Citi has been helping clients navigate the recent market reforms in Greece, and we will continue to do so as market transitions like T+1 come into effect.<div>It looks like Greece has a lot of preparation work to do ahead of the upcoming T+1 transition across the region. How is this progressing?<div>Pineda: A lot needs to happen in Greece for a frictionless T+1 rollout in October 2027. Today, there are two Central Securities Depositories (CSDs) in Greece – the Bank of Greece which supports fixed income, and AthexCSD, whose remit is equities. Let’s start with the positives.&nbsp;The Bank of Greece’s Securities Settlement System joined Target2Securities (T2S) during the first T2S migration wave back in June 2015, so T+1 compliance should be fairly straightforward. AthexCSD, however, is not connected to T2S, whilst a lot of its operations and systems are still fairly manual, so their T+1 journey is going to be far more complicated unless material improvements are made to their operating model. Together with the Hellenic Bank Association, Citi has been advocating for AthexCSD to implement a number of reforms. One such reform would like to put an end to AthexCSD’s dual account structure.&nbsp;Greece is somewhat of a market outlier in that broker dealers must open up dual accounts at AthexCSD when performing turnaround trades This refers to trades where securities are purchased and sold on the same day and aims to facilitate fair sales tax charge. Not only is this dual account structure operationally complex, but it often requires market participants to perform trade prioritization, which can be time-consuming. To make the T+1 adoption process simpler, AthexCSD will need to remove its dual account structure.<div>While the Bank of Greece is connected to T2S and its T+1 implementation process should be simpler than AthexCSD’s, it still needs to check a few boxes ahead of the roll-out of T+1. Could you elaborate please?Pineda: Like AthexCSD, the Bank of Greece is embarking on a T+1 journey, and it is engaging with all of the relevant market participants , including the T2S platform, local and EU regulators, custodians, brokers and other financial institutions, so as to ensure a smooth, consistent T+1 transition.&nbsp;Although a T2S member, the Bank of Greece still has a lot of work to do if it is to comply with T+1. For example, it is conducting a deep dive review of its current systems, processes and resources to identify changes which need to happen ahead of T+1, along with any potential challenges. Furthermore, it is also carrying out analysis on ways to further expedite certain activities, including trade processing, confirmations and settlements as T+1 inches closer.&nbsp;Citi has been actively participating in a number of industry working groups in Greece – and Europe more widely – where it has been instrumental in driving awareness about T+1, through knowledge sharing and collaboration with clients and regulators alike. If T+1’s implementation is to be straightforward, we encourage firms to read and onboard the recommendations made in the recently published EU T+1 High Level Roadmap.&nbsp;Similar to T+1 preparations in Spain, which we covered in a previous edition of ‘<a href="https://www.citigroup.com/global/insights/where-can-we-take-you">Where Can We Take You</a>’, market participants in Greece need to review their local practices and benchmark them against the EU’s recommendations. As a provider with extensive experience of facilitating previous T+1 transitions in North America and India, we look forward to supporting clients with their migration in Greece as well.</div></div></div></div></div>

Reform zeal is sweeping through Greece at a furious pace, as the country makes wholesale changes to its clearing, settlement and taxation regimes. Marcello Topa, Head of Global Advocacy for Investor Services at Citi, sits down with Manuel Pineda, Southern Europe Custody Head, Investor Services, Citi, in this latest edition of our “Where Can We Take You” series, to talk about some of the transformations that are re-shaping Greece’s capital markets.&nbsp;

Transforming Greece's Capital Markets

<div>Sparked by the Artificial Intelligence (AI) boom and resultant demand for semi-conductor related products, foreign investors are piling into Taiwan, and currently account for 40% + of the country’s $2.2 trillion stock market capitalization. 1 Just as global investors are giving a greater weighting to Taiwan in their portfolios, local regulators are pushing ahead with a series of positive reforms, all designed to make the market more accessible. &nbsp; In this latest edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, speaks with Jasmine Chu, Taiwan Custody Head, about these changes and their impact.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1731/1736;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/Jasmine-Chu.jpg" width="1731" height="1736">Jasmine Chu Taiwan Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure>Taiwan recently streamlined its account opening process. How did it go?Chu: Taiwan has been slowly digitalizing the account opening process for foreign investors. Previously, foreign investors - ahead of opening up an account - &nbsp; were required to provide a wet ink signature on a registration form, before delivering that same document in a hard copy format to their local custodian - a process many considered to be wholly inefficient. &nbsp;Citi held several ongoing discussions with the Taiwan Stock Exchange (TWSE) about the need for reform, and the rules were subsequently relaxed in 2023. Today, foreign financial institutions no longer need to provide a wet ink signature when opening up an account, as custodians – including Citi – will accept registration forms submitted in a PDF format. &nbsp;Certain account opening documents such as Power of Attorney (POA) and country addendum etc. still require wet-ink signatures, and some believe that this relaxation does not help the overall account opening process. It is important however to remember that this is just one step in the market advocacy journey and an important milestone in Taiwan’s digital transformation.&nbsp;Taiwan has been updating its pre-funding rules too. What exactly is going on?&nbsp;<div>Chu: Historically, foreign financial institutions were required to pre-deliver cash and securities in full prior to the broker’s trading quote on T-date for any transactions involving alerted stocks under disposition measures, e.g. due to irregular trading activity, erratic price movements, etc. &nbsp; &nbsp;The rule was well-meaning – it was supposed to shield investors from excessive volatility – however, it caused challenges elsewhere. Not only did it create additional counterparty and settlement risk for investors, but the rule made it incredibly difficult for foreign investors to trade alerted stocks. &nbsp;Due to the time zone differences involved, the provisions sometimes meant that foreign investors in certain markets were disadvantaged when placing orders with local brokers - at least relative to Taiwan-based institutions. &nbsp;While domestic investors can leave cash and securities with brokers who can earmark those assets in real-time, foreign investors who are required to appoint a custodian by law, need to move stocks from custodians to the local brokers prior to the relaxation. &nbsp;Following extensive dialogue between Citi Taiwan and the regulator – the Securities and Futures Bureau (SFB), TWSE, the Taiwan Depository &amp; Clearing Corporation (TDCC) and other local market participants, this pre-delivery mechanism was removed in May 2024 for alerted stocks under disposition measures. &nbsp;Now, local brokers can execute a trade involving an in-scope alerted stock once they have received confirmation that a foreign institutional investor’s cash or securities are earmarked for that particular transaction. Together with reducing settlement risk, the changes have led to a number of operational efficiencies, and as a result, it is now much easier for foreign investors to trade alerted stocks. &nbsp;<div>Can you please elaborate on the different amendments to Taiwan’s custody rules?<div>Chu: Until February 2025, foreign institutional investors trading domestic securities were only allowed to appoint a single local custodian. Again, the rule was well-intentioned – as there was only one custodian, it was easier for regulators to keep tabs on investors and their positions, but for investors, it created concentration risk and undermined their contingency planning efforts – issues that Citi repeatedly flagged in the 2022 AmCham White Paper. &nbsp;After discussions with the Financial Supervisory Commission (FSC), the TWSE, and the TDCC, it was agreed that foreign institutional investors would be permitted to appoint one primary custodian, and up to three secondary custodians. &nbsp;The primary custodian, however, is still the main point of contact for local regulators and financial market infrastructures (FMIs) and are also responsible for a number of administrative activities, such as the registration process for foreign investors and overseeing shareholder services (e.g. providing tax information and split voting declarations) to corporate registrars, dealing with withholding tax statements, shareholder meeting notifications, etc. &nbsp;In contrast, the role of the secondary custodian is fairly limited in both nature and scope. &nbsp; &nbsp;Despite this, the new and updated custody model in Taiwan allows foreign institutions greater flexibility, insofar as they can appoint different custodians to support their various investment portfolios. Also, with greater competition in the local custody market comes potential cost benefits for clients too.&nbsp;<div>What other reforms is Citi advocating for in Taiwan?&nbsp;Chu: We are working on a few initiatives with Taiwan’s regulators. &nbsp;Firstly, we are pushing for foreign investors trading futures in Taiwan to be allowed to repatriate margin directly into their offshore cash accounts. Currently, there is a convoluted repatriation process whereby the futures margin must be sent from an investor’s futures commission merchants (FCM) customer margin account to their local custodian, before it can be remitted into an offshore cash account. The time and costs involved with remitting funds would fall significantly if local regulators made it possible for margin to be transferred directly from the FCM to an offshore cash account.We are also speaking to regulators, including the SFB about T+1. I am aware the regulator recently sent out a questionnaire to foreign investors asking them for feedback about moving to T+1. &nbsp;We understand some investors have voiced concerns about FX funding and liquidity should Taiwan transition to T+1 - particularly as the TWD is a restricted currency. &nbsp;Taiwan is trying to turn itself into a regional asset management hub. What is going on exactly?Chu: &nbsp;With its deep pool of retail investors and sizeable Exchange Traded Fund (ETF) market, Taiwan is well-positioned to become an asset management leader in Asia-Pacific. This comes as the government recently pledged to transform Taiwan into an asset management hub and double the amount of assets managed in the country to $2 trillion within the next five years.2 &nbsp;To achieve this ambitious goal, the government is rolling out a series of changes. &nbsp;In July 2025, the FSC – in collaboration with local government- announced the establishment of a trial asset management zone in the port city of Kaohsiung. Incentives, including rent discounts, administrative support and subsidies, are being deployed to encourage firms to move to Kaohsiung. Currently, 14 banks, six securities investment trust firms and securities investment consulting firms and three insurance companies have been approved to set up operations in the newly launched asset management zone. 3 &nbsp;The FSC has also relaxed 28 regulations and introduced various measures, including a liberalization of private banking services and an expansion of the number of banks authorized to provide asset-management services to high-net-worth clients. 4 It also announced the creation of a Taiwan Individual Savings Account (TISA), mirroring Japan’s Nippon Individual Savings Account. 5&nbsp;How is Citi supporting clients in Taiwan?&nbsp;Chu: Powered by the semiconductor industry and the AI manufacturing supply chain, Taiwan is a market that foreign investors should not ignore. &nbsp;Citi Taiwan, with its diverse and broad client base of both foreign and domestic institutional investors, has extensive and unique insights into the dynamics underpinning this vibrant economy. &nbsp;Our clients can count on us to help them navigate this growing market, both now and in the future. &nbsp;&nbsp;</div></div></div></div></div>

1. <a href="https://www.ceicdata.com/en/indicator/taiwan/market-capitalization">CEIC Data</a>2. Asia Asset Management – August 7, 2025 –&nbsp;<a href="https://www.asiaasset.com/post/29925-fsc-0806" target="_blank" rel="noreferrer noopener">Taiwan’s asset management hub measures include version of Japan’s NISA</a>3. FSC – August 6, 2025 -&nbsp;<a href="https://www.fsc.gov.tw/en/home.jsp?id=54&amp;parentpath=0,2&amp;mcustomize=multimessage_view.jsp&amp;dataserno=202508110002&amp;dtable=News" target="_blank" rel="noreferrer noopener">FSC Approves Taishin International Bank's Application for Business Trial in the Kaohsiung Asset Management Zone</a>&nbsp;4. FSC – August 6, 2025 -&nbsp;<a href="https://www.fsc.gov.tw/en/home.jsp?id=54&amp;parentpath=0,2&amp;mcustomize=multimessage_view.jsp&amp;dataserno=202508110002&amp;dtable=News" target="_blank" rel="noreferrer noopener">FSC Approves Taishin International Bank's Application for Business Trial in the Kaohsiung Asset Management Zone</a>5. Asia Asset Management – August 7, 2025 –&nbsp;<a href="https://www.asiaasset.com/post/29925-fsc-0806" target="_blank" rel="noreferrer noopener">Taiwan’s asset management hub measures include version of Japan’s NISA</a>

Taiwan’s dominance in the global semiconductor industry coupled with the recent AI surge is fueling massive foreign investment into Taiwan. In parallel, local regulators are actively implementing reforms to make the market even more accessible. Jasmine Chu, Taiwan Custody Head for Investor Services discusses these exciting changes and their implications for investors.

Where Can We Take You? Taiwan

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<div>Regulators in the U.S. have been incredibly busy lately, and so too has the post-trade industry. Whether it is the looming rollout of mandatory clearing for U.S. Treasury and repo transactions, the recent passage of the GENIUS Act, ongoing discussions about the market structure bill, the Depository Trust &amp; Clearing Corporation’s (DTCC) modernization agenda, or the debate about expanding trading hours, custodians are having to adapt and update their processes.</div><div>In this latest edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, speaks to Chris Ravn, NAM Custody Head, about the regulatory and infrastructure changes sweeping through the U.S.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:509/466;border-radius:10px;width:32.09%;" src="/rcs/citigpa/storage/public/chris-ravn.jpg" width="509" height="466">Chris Ravn North America Head of Custody Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure>Topa: The US has recently amended its clearing rules. Can you shed a bit more light on this?Ravn: We have seen a lot of Black Swan events strike our industry over the last decade – starting with the 2014 Flash Crash and 2019 repo market spike, right through to Covid and the regional banking meltdown in 2023.1 Each of these episodes triggered a degree of volatility in the US Treasury (UST) market – a nominally safe haven for investors – prompting regulators to intervene.&nbsp;Today, UST transactions are either settled bilaterally or centrally cleared at the DTCC’s Fixed Income Clearing Corporation (FICC), the US’s sole Covered Clearing Agency (CCA).2&nbsp;However, in late 2023, the Securities and Exchange Commission (SEC) announced that market participants, including broker-dealers and institutional investors, will now need to centrally clear certain UST cash and all repo transactions via a CCA. Initially, the rules were supposed to go live in December 2025 for UST cash, and June 2026 for repos, but the deadlines were delayed by a year to give firms additional time to comply.3Given the significant implications for many of our custody clients, we are actively engaged in comprehensive support initiatives. Our efforts have included client education, operational preparation, fostering partnerships with our Markets colleagues who offer clearing services, and establishing direct connectivity to the CCPs. To further aid understanding and compliance, we have published a series of thought leadership articles and hosted senior FICC executives to directly address our clients’ questions.Topa: Can you please give an overview of the digital asset landscape in the US at the moment, especially with all of the regulatory changes that are going on?<div>Ravn: Following the recent political changes in the US, there has been a 180-degree shift in the regulatory attitudes towards digital assets – in fact, President Trump signed an Executive Order in March 2025 promising to make the U.S. the crypto capital of the world.4&nbsp;A few months later in July 2025, the GENIUS Act was signed into law. In addition to defining what a payment stablecoin actually is, the GENIUS Act also creates a licensing and regulatory framework for domestic payment stablecoin issuers and standards for foreign issuers when participating in the US’s payment stablecoin market.5 The rules also provide greater clarity around the custody and safekeeping requirements for stablecoin-related assets.6 Hot on the heels of the GENIUS Act is the market structure bill, which is currently under negotiation. Whereas the market structure bill will focus on other digital assets and could potentially update some longstanding securities rules.&nbsp;Several crypto-custody rules and guidelines have evolved over the last nine months in the US. In early 2025, the SEC’s Staff Action Bulletin (SAB) 121 – a Biden-era SEC guideline that required custodians holding crypto assets to register them as being liabilities on their balance sheets – was scrapped.7 In March 2025, the Office of the Comptroller of the Currency (OCC) published Interpretive Letter 1183, which reaffirmed that crypto-asset custody services are a permissible activity for national banks and eliminated the supervisory non-objection process for crypto-asset activities.8 More recently in July 2025, the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC) and the OCC published a joint letter outlining their risk management expectations for banks offering crypto-asset safekeeping.9&nbsp;In response, more custodians are beginning to launch crypto-custody services for institutional clients, including Citi, which plans to start offering such services in 2026.&nbsp;<div>Topa: Tell me about the DTCC’s modernization plans.<div>Ravn: The DTCC’s modernization plan is a critical next step in how the US’s financial markets will operate behind the scenes. For decades, the system was built for a different time, a different volume of trading, and a much simpler mix of products. With the industry pushing for faster settlements, greater resilience, better data, extended trading hours and the ability to handle new products like tokenized assets, the DTCC has launched a number of multi-year programs, including initiatives like Project Ion and their Future of Clearing workstreams.&nbsp;The DTCC is looking to re-platform their core clearing functions, stripping away operational complexity, and introducing exciting new capabilities, such as capturing trades during extended hours and providing much richer, machine-readable data. A big win here is their plan to upgrade client connectivity to a strictly ISO 20022 format, using messaging and file channels, with testing kicking off in 2026 and full implementation expected by 2027.&nbsp;On the settlement side, the DTCC is going to support partial deliver orders, expand the data fields in member messages, and simplify complex settlement workflows. In clearing, their Universal Trade Capture (UTC) service will benefit from having extended trading hours to support the increased volumes and growing number of trading houses. The DTCC is also improving how Exchange Traded Funds (ETFs) with options components are cleared, working between the NSCC and the Options Clearing Corporation. All of these changes are designed to build a more dynamic and resilient trading environment. The goal is to maximize liquidity and significantly reduce counterparty risk, ensuring the market can handle whatever comes next.<div>Topa: Looking further ahead, what other big infrastructure changes do you see happening in the US?Ravn: The US equity markets are witnessing a growing momentum shift towards extended trading hours, with discussions around 24/7 or 24/5 operations gaining traction, largely driven by the accelerating retailization of equities. Proponents argue that continuous trading would significantly enhance global investor access to the US market, thereby boosting liquidity and refining price discovery.&nbsp;Major exchanges, including Nasdaq and CBOE Global Markets, are actively exploring the introduction of 24/5 trading, while the NYSE aims to extend weekday trading on its Arca Equities Exchange to 22 hours daily. These initiatives, signaling a coordinated move towards near-continuous weekday trading, are contingent on regulatory approvals and the readiness of critical market infrastructure.&nbsp;The implications of these changes are far-reaching for the post-trade industry, and it is not yet fully prepared for such a shift. Extended trading hours would fundamentally alter intraday liquidity patterns, increase the volume of settlement instructions outside traditional banking windows, and necessitate advanced intraday risk management tools for margining and fail-management.&nbsp;Infrastructure providers like the DTCC must extend message handling, ensure 24-hour operations or robust end-of-day cutoffs, and guarantee continuous reporting and surveillance. Furthermore, settlement cycles, reconciliation timing, and liquidity buffers will require a complete overhaul to prevent liquidity bottlenecks.&nbsp;While exchanges have submitted applications and published timelines, and the DTCC has incorporated support for longer trade capture into its modernization roadmap, full operational readiness depends on extensive, coordinated efforts.&nbsp;This is a hugely exciting initiative, but there is still a lot of work to be done.</div></div></div></div></div>

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1 DTCC – June 17, 2024 – <a href="https://www.dtcc.com/dtcc-connection/articles/2024/june/17/impacts-of-mandatory-clearing-for-us-treasury-repo" target="_blank">Impacts of mandatory clearing for US Treasury Repo&nbsp;</a>2 SIFMA – <a href="https://www.sifma.org/explore-issues/treasury-clearing/" target="_blank">Treasury Clearing&nbsp;</a>3 <a href="https://www.sec.gov/newsroom/press-releases/2025-43" target="_blank">SEC Extends Compliance Dates and Provides Temporary Exemption for Rule Related to Clearing of U.S. Treasury Securities&nbsp;</a>4 White House – March 6, 2025 – <a href="https://www.whitehouse.gov/fact-sheets/2025/03/fact-sheet-president-donald-j-trump-establishes-the-strategic-bitcoin-reserve-and-u-s-digital-asset-stockpile/" target="_blank">Fact sheet: President Donald J Trump establishes the strategic Bitcoin reserve and US Digital Asset stockpile&nbsp;</a>5 Sidley – July 21, 2025 – <a href="https://www.sidley.com/en/insights/newsupdates/2025/07/the-genius-act-a-framework-for-us-stablecoin-issuance" target="_blank">The GENIUS Act: A Framework for US StableCoin Issuance&nbsp;</a>6 Sidley – July 21, 2025 – <a href="https://www.sidley.com/en/insights/newsupdates/2025/07/the-genius-act-a-framework-for-us-stablecoin-issuance" target="_blank">The GENIUS Act: A Framework for US StableCoin Issuance&nbsp;</a>7 <a href="https://www.sec.gov/rules-regulations/staff-guidance/staff-accounting-bulletins/staff-accounting-bulletin-122" target="_blank">SEC Staff Accounting Bulletin 122&nbsp;</a>8 <a href="https://occ.gov/topics/charters-and-licensing/interpretations-and-actions/2025/int1183.pdf" target="_blank">https://occ.gov/topics/charters-and-licensing/interpretations-and-actions/2025/int1183.pdf&nbsp;</a>9 Federal Reserve – July 14, 2025 – <a href="https://www.federalreserve.gov/newsevents/pressreleases/bcreg20250714a.htm" target="_blank">Agencies issue joint statement on risk management for crypto-asset safekeeping</a>

The US financial markets are currently navigating a period of profound transformation and regulatory evolution. Key initiatives such as the mandatory clearing for US Treasury and repo transactions, the legislative impact of the GENIUS Act on digital asset regulation, and the DTCC's comprehensive modernization efforts are reshaping the overall market dynamics. With potential extended trading hours also on the horizon, what does this mean for infrastructures and investors alike?

Where Can We Take You? United States

<div>The Nordic capital markets continue to flourish. And whilst EU regulations aimed at promoting closer integration and cross-border harmonization have largely been a force for good in the Nordics, some rules could potentially cause problems for the region’s capital markets. In this edition of our “Where Can We Take You” series, Marcello Topa, Global Head of Advocacy for Investor Services at Citi, sits down again to Ola Mjorud, Nordic Custody Country Head, to talk about what differentiates the Nordics capital markets from its peers.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1633/1585;border-radius:10px;width:31%;" src="/rcs/citigpa/storage/public/Ola_new_resized.png" width="1633" height="1585">Ola Mjorud Nordic Custody Country Head Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure>Topa: What differentiates the Nordic’s capital markets from its peers?Mjorud: As a region, the Nordics have a deep pool of investors as education about finance and investing begins at a young age. In Sweden for example, the government has played a critical role in supporting the issuance and marketing of so-called people’s or popular shares – otherwise known as Folkaktier.&nbsp;The tax framework in the Nordics also provides a compelling incentive for people to invest and in addition, the region’s institutional investors, e.g. sovereign wealth funds and defined contribution pension funds, have sizeable Assets Under Management (AUM) too. Norway’s $1.94 trillion1 Government Pension Fund Global, for example, owns 1.5% of all shares in the world’s listed companies – corresponding to roughly 9,000 holdings.&nbsp;All of this is underpinned by a network of leading banks and dynamic financial market infrastructures (FMIs), e.g. Central Securities Depositories (CSDs) and Central Counterparties (CCPs). This is now driving market harmonization efforts across the region.Topa: How is post-trade reform putting the Nordics on a strong footing?<div>Mjorud: Although the Nordic capital markets are in good shape, efforts to achieve greater harmonization – particularly across post-trade – are still ongoing, in what proponents argue will be a catalyst for even more investment in the region.&nbsp;One such standardization initiative is Target2Securities (T2S), the European Central Bank’s (ECB) pan-EU settlement platform. By centralizing the settlement of securities using Central Bank money, T2S is not just facilitating further EU integration and standardization, but it is also enabling market participants to obtain cost synergies through liquidity and collateral optimization. While T2S is live in most of Europe, this is not the case in the Nordics.&nbsp;To date, only Denmark and Finland have joined T2S, while Norway and Sweden remain outside of it, partly because they wanted to see how the other regional markets were faring on the platform. In addition, Sweden and Norway have also prioritized the implementation of T2, the real-time gross settlement system operated by Eurosystem. Once Norway and Sweden have transitioned their local currencies onto T2, T2S will be the obvious next step.Euronext, the CSD operator for Norway, has confirmed its ambition to move to T2S albeit it has a dependency on the Norges Bank, the Norwegian Central bank’s decision on T2. Sveriges Riksbank, Sweden’s Central Bank, is anticipating anticipating a move to T2 in 2030 followed by a T2S migration potentially later that same year, which has since been corroborated by Euroclear Sweden.2&nbsp;While it is true that T2S set-up costs and ongoing costs are quite expensive, we believe the markets which adopt T2S will become more attractive in the long-term and will set themselves up for future success.&nbsp;T2S is just one of several standardization initiatives currently underway in the region. Other milestone projects include Euronext’s Convergence Programme – which will see settlements and other CSD activities across Denmark and Norway (plus Portugal and Italy) transition to a single common platform starting in 2028, and the rollout of T+1 – due to go live across Europe on October 11, 2027.&nbsp;Post-trade integration of this sort will be instrumental in further enhancing the Nordic markets’ attractiveness as a leading European investment destination.<div>Topa: What needs to happen to ensure the Nordics stay strong?<div>Mjorud: For the most part, post-trade harmonization is a sensible strategy – through closer integration, barriers precluding cross-border investing and trading can be removed, thereby reducing friction and costs at a time when organizations’ margins are already being badly squeezed elsewhere. However, in markets such as the Nordics, where investing is already fairly seamless, harmonization initiatives, such as the EU’s Savings and Investments Union (SIU), despite having perfectly good intentions, will need to be carefully considered.&nbsp;Similar to its Capital Markets Union (CMU) predecessor, the SIU’s primary objective is to stimulate investment in the EU, expedite consolidation across trading and post-trade infrastructures, streamline regulatory supervision, and improve competitiveness and integration in the banking sector.&nbsp;However, while the SIU will unlock a number of benefits, there are concerns in some circles it could inadvertently create challenges for the Nordics. Even very tentative proposals to strengthen asset safety requirements at an EU-level– which is obviously a sensible idea – might inadvertently weaken some of the existing investor protection mechanisms already available to Nordic investors.The Nordic markets have a robust account structure, which is clearly defined and functions excellently. If a Nominee runs into trouble in Sweden, it is very clear that those nominee registered assets do not belong to that account operator – a set-up which is arguably better defined than in many other locations and which ensures a high degree of asset safety. While the SIU is not making any explicit changes to the account structure just yet, it is a distinct possibility this may happen in due course. What we would not want to see is for the SIU to introduce new changes, which make the Nordic account model more complicated and expensive.The Nordic’s capital markets continue to go from strength to strength. While standardization should be embraced, there is a risk that some of the EU’s integration initiatives (e.g. SIU) might unwittingly hobble the Nordic region’s already excellent investment frameworks and client protections.</div></div></div></div>

1 <a href="https://globalswf.com/fund/NBIM" target="_blank">Global SWF&nbsp;</a>2 Euroclear – September 10, 2025 – <a href="https://www.euroclear.com/newsandinsights/en/Format/Videos/euroclear-nordic-vision.html" target="_blank">https://www.euroclear.com/newsandinsights/en/Format/Videos/euroclear-nordic-vision.html</a>

Strengthening The Nordics – 2026 Edition

<div>Whether it has been the introduction of shorter settlement cycles, the unprecedented pace of digitalization or the industry’s doubling down on market integration initiatives, the first half of the 2020s has been nothing short of transformative for Securities Services. Marcello Topa, Head of Global Advocacy for Investor Services at Citi, shares what 2026 could have in store for us.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:300/300;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure>Settlement efficiency to remain a strategic prioritySimilar to 2025, shorter settlements will be a big theme in 2026. &nbsp;North America’s T+1 implementation is now in the rear-view mirror, but deadlines in Europe, the UK and other markets, e.g. Hong Kong, Pakistan, are fast approaching. According to Swift’s settlement instruction message data, 35% of the market is now settling on T+1, but it expects this will rise to 50% in 2027, before surging past 70% by 2030. 1 &nbsp;Financial institutions are having to recalibrate their end-to-end operations. From trade execution, to matching and reconciliations, funding and inventory management, right through to clearing and settlement, the rollout of T+1 is having a massive impact on the entire transaction lifecycle. &nbsp;Even in North America, a fairly homogenized securities market which migrated to T+1 back in May 2024, 48% of survey participants in Citi’s Securities Services Evolution 2025 white paper indicated that they are still running T+1 projects in the region. Firms should in no way underestimate the challenges which T+1 will cause in markets which are fragmented or complex, e.g. Europe which has 32 transitioning markets, 30+ Central Securities Depositories (CSDs) and 11 settlement currencies, or in regions/countries where FX liquidity may be more constrained. &nbsp;Help is at hand, however. &nbsp;Industry bodies, including the UK Accelerated Settlement Taskforce, the EU T+1 Industry Committee and the Swiss Post-Trade Council, have all published their recommendations on what the industry needs to do ahead of T+1’s big bang in Europe in October 2027.In October 2025, the European Securities and Markets Authority (ESMA) updated its Regulatory Technical Standards (RTS) on Settlement Discipline, which among other things called for industry-wide adoption of same day trade allocations and settlement instructions, the mandatory introduction of hold and release, auto-partial settlement and auto-collateralization, and a phased-in implementation schedule starting in December 2026. 2If firms are to have a frictionless T+1 transition in Europe, they must use 2026 to automate their operations. The importance of automation has not been lost on UK respondents to our white paper, of whom 43% said improvements to internal processes will be a critical enabler for T+1, whilst 26% said the same thing about upgrading or re-platforming legacy technology. &nbsp;Any technology enhancements need to be fully future-proofed - simply patching up ageing systems to address the needs of T+1 will not suffice. Instead, firms need to ensure that their infrastructure of tomorrow is primed to handle T+0, real-time or atomic settlements and 24/5 trading. &nbsp;Equally important is that while firms should be prioritizing their own internal T+1 preparations, they also need to check that clients and counterparties are doing the same. &nbsp;If clients or counterparties are lagging behind on T+1, &nbsp;then this will have consequences for all of the other market participants in the investment and intermediary chain. &nbsp;Citi has a long track record of supporting its clients with the T+1 transitions in various markets. &nbsp; &nbsp;In the US &nbsp;- and now Europe - Citi has been engaging with clients and counterparties on T+1 – by holding one-on-one meetings, events, webinars and publishing thought leadership articles. As an active participant in many of the T+1 Working Groups and industry association dialogues, Citi is also shaping the direction of travel on accelerated settlements. In addition, Citi has a number of best-in-class solutions e.g. E2C, Single Legal Vehicle Account Structures, Single Event Processing, etc, all designed to ensure clients have a seamless T+1 experience. &nbsp;By adopting a ‘follow the sun’ operating model, Citi can now provide assistance to clients at any point during their working day – once again, making their T+1 implementation journey much easier. &nbsp;Digitalization propels securities services forward<div>Distributed Ledger Technology (DLT) and digital assets are becoming more embedded in post-trade, a trend that is likely to prevail in 2026. &nbsp;A turning point on digital assets appears to be tantalizingly close, with the industry zeroing in on three core use cases, namely tokenized collateral, fund tokenization, and StableCoins. &nbsp;Tokenizing financial instruments, e.g. fixed income, equities, cash, for collateral management purposes could bring about a number of tangible benefits, namely increased asset velocity and more favorable risk capital weightings, enabled by reduced overnight funding costs, better liquidity ratios and improved risk weighted asset provisions. This is underlined in the Securities Services Evolution 2025 white paper, which found that tokenization of fixed income assets in the form of collateral is the fastest growing digital asset class. &nbsp;In funds, tokenization will accelerate the subscription and redemption process – in today’s market, it can sometimes take an investor up to three days to subscribe to a mutual fund, but in a tokenized environment this can be done in real-time. Investor demand for tokenized funds is there – for example, BlackRock’s tokenized treasury fund is currently managing $2.9 billion.3 &nbsp;Tokenization could also turbo-charge the push by private market funds into retail. Historically an asset class accessible only to large institutions, tokenization of private market funds would reduce the cost of investment through fractionalization, allowing managers to target return-hungry retail buyers. &nbsp;The ascendency of StableCoins is expected to continue in 2026, sparked by the recent regulatory changes in the US, most notably the passage of the GENIUS Act, President Trump’s Executive Order promising to make the US the crypto capital of the world,4 and the regulatory clarity on crypto-custody.In response, more custodians are beginning to launch crypto-custody solutions for institutional clients, including Citi, which plans to start offering such services in 2026. &nbsp;Outside of digital assets, Artificial Intelligence (AI) is being increasingly integrated into post-trade operations, generating all sorts of productivity gains. While some providers are leveraging AI to expedite analytics or summarize large data sets, others are using the technology to streamline previously analogue client-facing activities, such as onboardings and reporting. &nbsp;However, with new technology, there comes new risks. &nbsp;Cyber-crime has been a growing challenge for the industry over the last decade, but the emergence of powerful AI tools is going to amplify the problem, e.g. through AI-assisted vulnerability research and exploit development, which enables access to systems through the discovery and exploitation of flaws in code and configurations.5 Operational resilience and cyber-hygiene will therefore remain top focus areas for the industry in 2026 and beyond.&nbsp;<div>Integration and common standards take precedent in 2026<div>Market integration efforts show no sign of losing momentum in 2026.In the EU, fueled by the Draghi Report’s findings and the renewed focus on the Savings and Investments Union (SIU), post-trade reform remains firmly on course, whether it is T+1 or the ambitious integration strategies being pursued by leading European Financial Market Infrastructures (FMIs), e.g. &nbsp;Euronext’s Convergence Programme; Euroclear’s commitment to provide a single post-trade point of access for equities, fixed income and funds;6, and Clearstream’s Project Uno, which will see Clearstream become the consolidated place of settlement for T2S markets.7 &nbsp;As part of the SIU, the European Commission (EC) announced a package of reforms on December 4, &nbsp;2025, which among other things will create passporting opportunities for trading venues and CSDs, introduces pan-European Market Operator status for trading venues, streamlines the distribution of funds regulated under the Alternative Investment Fund Managers Directive (AIFMD) and UCITS, removes regulatory barriers related to DLT, and gives ESMA greater supervisory powers.8Market integration is not unique to Europe. nuam, the single market bringing together the Stock Exchanges of Chile, Colombia and Peru, is expected to become interoperable from 2026, paving the way for a consolidated equity market across the three participatory countries.9 Similarly, the Abu Dhabi Securities Exchange’s Tabadul platform, a digital exchange supporting mutual market access, continues to expand with Armenia becoming the latest member, joining the financial markets of Abu Dhabi, Bahrain, Oman and Kazakhstan. &nbsp;The drive towards ISO 20022 in securities markets marches on. Whilst firmly embedded in payments, the securities services industry is gradually embracing ISO 20022, with the Depository Trust &amp; Clearing Corporation (DTCC) due to adopt the standard in Q3 2027. 10 A common, more enriched data dictionary, enabled by ISO 20022, will help usher in greater standardization and automation, facilitating all sorts of benefits for intermediaries and investors alike. &nbsp;Citi is working closely with market participants in preparation for the adoption of ISO 20022. However, the bank is also actively lobbying on behalf of clients to ensure there is no mandatory imposition of ISO 20022 further up the chain, as the demand is simply not there. Even so, Citi is working with clients to better understand their communication requirements so that it can help them transition to ISO 20022 should they choose to in due course. &nbsp;Just as the previous 12 months have been full of change, so too will 2026. &nbsp;To weather the challenges and capitalize on the opportunities which the transformative market developments will bring, engaging with a leading provider with deep global and local subject matter expertise will be the key differentiator. &nbsp;</div></div></div></div>

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1. Swift – September 24, 2025 – T+1: <a href="https://www.swift.com/news-events/publications" target="_blank">One year on…A new chapter begins</a>2. ESMA – October 10, 2025 – <a href="https://www.esma.europa.eu/press-news/esma-news/esma-proposes-key-reforms-settlement-discipline-supporting-transition-t1" target="_blank">ESMA proposes key reforms to settlement disciple, supporting the transition to T+1</a>3. Coin Desk – June 18, 2025 – <a href="https://www.coindesk.com/markets/2025/06/18/blackrocks-29b-tokenized-treasury-fund-now-accepted-as-collateral-on-cryptocom-deribit" target="_blank">BlackRock’s $2.9 billion tokenised treasury fund now accepted as collateral on Crypto.com, Deribit</a>4. White House – March 6, 2025 – <a href="https://www.whitehouse.gov/fact-sheets/2025/03/fact-sheet-president-donald-j-trump-establishes-the-strategic-bitcoin-reserve-and-u-s-digital-asset-stockpile/" target="_blank">Fact sheet: President Donald J Trump establishes the strategic Bitcoin reserve and US Digital Asset stockpile</a>5. National Cyber Security Centre – May 7, 2025 – <a href="https://www.ncsc.gov.uk/report/impact-ai-cyber-threat-now-2027" target="_blank">Impact of AI on cyber threat from now to 2027</a>6. Euroclear – July 15, 2025 – <a href="https://www.euroclear.com/newsandinsights/en/press/2025/mr-19-connecting-eu-markets-across-asset-classes.html" target="_blank">Connecting EU markets across asset classes</a>7. Clearstream – <a href="https://www.clearstream.com/resource/blob/4357332/226c8d0e04305329e627a2da26258e9a/unified-for-new-opportunities-kick-off-summary-session-data.pdf" target="_blank">Project Uno</a>8. European Commission – December 4, 2025 – <a href="https://ec.europa.eu/commission/presscorner/detail/en/ip_25_2893" target="_blank">Commission launches major package to fully integrate EU markets</a>9. BN Americas – September 2, 2025 – <a href="https://www.bnamericas.com/en/analysis/integration-of-chilean-peruvian-and-colombian-stock-exchanges-could-boost-mining-financing" target="_blank">Integration of Chilean, Peruvian, and Colombian stock exchanges could boost mining financing</a>10. Post-Trade 360 – October 10, 2025 – <a href="https://posttrade360.com/news/regulation/iso-20022-in-securities-a-single-film-or-a-trilogy/" target="_blank">ISO 20022 /in securities: A single film or a trilogy</a> &nbsp;

Whether it has been the&nbsp;introduction of shorter settlement cycles,&nbsp;the&nbsp;unprecedented&nbsp;pace of&nbsp;digitalization&nbsp;or&nbsp;the industry’s doubling down on market integration initiatives, the first half of the 2020s&nbsp;has&nbsp;been&nbsp;nothing short of transformative for&nbsp;Securities Services.&nbsp;Marcello Topa, Head of Global Advocacy for Investor Services at Citi,&nbsp;shares&nbsp;what 2026&nbsp;could&nbsp;have in store&nbsp;for us.

Where Can We Take You in 2026?

This article highlights the following key developments in Singapore's financial markets:<ul><li>The creation of a Global Listing Board (GLB) in partnership with Nasdaq, set to launch in mid-2026. This initiative will offer a harmonized, dual-listing framework for large-scale companies to access capital in both the U.S. and Singapore.</li><li>A significant overhaul of Singapore's post-trade infrastructure, which includes a potential move to a more cost-effective omnibus account model and a deliberate timeline for adopting T+1 settlement, which is not expected before October 2027</li><li>Insight into Singapore's strategy to become a leading digital asset hub by establishing a robust regulatory framework and spearheading innovation in asset tokenization through key initiatives like Project Guardian</li></ul>

The pace of change is accelerating in Singapore, as the country pushes ahead with ambitious reforms to strengthen the country’s equity market and expedite the adoption of digital assets. &nbsp;In this latest edition of our “Where Can We Take You?” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, talks to Lai Chun Gan, Singapore Custody Head at Citi, about Singapore’s market transformation.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:400/400;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="Photo of Marcello Topa, Head of Global Advocacy for Investor Services at Citi" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:303/398;border-radius:10px;width:24.91%;" src="/rcs/citigpa/storage/public/gan-lai-chun.jpg" alt="Photo of Lai Chun Gan, Singapore Custody Head at Citi" width="303" height="398">Lai Chun Gan Singapore Custody Head, &nbsp;Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h2>Topa: Can you provide an overview of the Singapore securities market?</h2>Gan: Singapore has a dynamic and mature securities market, known for its robust regulatory framework and international connectivity. It is considered a gateway for investors looking to access the growth potential of Asia and the market reflects the broader economic health of the region.The securities market operates primarily through the Singapore Exchange (SGX). The SGX is responsible for the trading of securities and derivatives, carried out via its Securities Trading (SGX-ST) and Derivatives Trading (SGX-DT) divisions. As the front-line regulator, the SGX oversees securities clearing and settlement, and acts as the Central Counterparty (CCP) and Central Securities Depository (CSD).The Monetary Authority of Singapore (MAS) serves as Singapore's central bank and financial regulatory authority. As the statutory regulator, MAS oversees the financial markets and the SGX itself.<h2>Topa: The country is trying to make its equity market more competitive. What is it doing exactly?</h2>Gan: Singapore wants to boost its equity market's competitiveness by turning the country into a more attractive listing destination for promising growth companies. MAS established the Equities Market Review Group in 2024 to identify ways this could be done.In November 2025, the Review Group published its final recommendations, one of which was to onboard a proposal from the Singapore Exchange (SGX) and Nasdaq to create a dual listing bridge between the two exchanges - a move designed to enhance market connectivity.The SGX-Nasdaq collaboration will enable companies with a market capitalization of at least S$2 billion to use a harmonized, cross-border listing framework between the US and Singapore, making it easier and cheaper for businesses to access capital, investors and liquidity across both jurisdictions.1 This Global Listing Board (GLB) is scheduled to go live in mid-2026.The MAS recently conducted an industry-wide consultation on some of its suggested regulatory amendments, which are aimed at facilitating dual listings on the GLB.2These proposals include allowing companies to use a single prospectus, synchronising the IPO timelines between Singapore and the US, and permitting issuers to conduct certain activities, e.g. the publication of forward-looking statements, executing pre-determined trades, undertaking share repurchases, etc, in a manner similar to practices in the US.3<h2>Topa: The Review Group also advised that Singapore modernize its post-trade custody model. Can you share what is happening here?</h2>Gan: Singapore's post-trade custody model is being overhauled, as it looks to align local custody practices with those of other countries. Today, local investors in Singapore must hold their SGX-listed securities in segregated accounts at Central Depository (CDP), either directly or indirectly via a sub-custodian who is a CDP depository agent. This requirement puts Singapore at odds with a lot of other leading markets, where investors are allowed to use omnibus account structures.Although segregated accounts offer investors greater transparency, the omnibus model is lower cost and operationally less cumbersome. A consultation is currently live on whether omnibus account structures should be rolled out.4 Should Singapore go ahead with adopting the omnibus account model, we expect local investors' participation in the domestic market to increase.Citi has been actively involved in discussions about post-trade reform with local market players, including regulators and financial market infrastructures (FMIS). Together with industry groups, Citi channels global investors' needs and demands to the FMIs, and, by leveraging our global network, Citi bridges international practices with local requirements.<h2>Topa: What is Citi doing to support institutional clients as Singapore inches towards an omnibus model?</h2>Gan: While the changes primarily impact local retail investors, we work with a lot of private banks and wealth managers, whose underlying clients are those exact same local investors. We are fully ready to support institutional clients who wish to opt into the omnibus model. For clients who are still undecided about which model to choose from, we are able to assist them in their analysis to identify the account structure best suited for their requirements.<h2>Topa: Can you provide an update on the latest developments regarding CSD costs and charges?</h2>Gan: A study by the ValueExchange revealed that 67% of market participants felt that settlement costs in Singapore were unnecessarily high, as did 44% in Indonesia and 34% in Malaysia.5 We are speaking with CSDs in Asia, including CDP, about how they could potentially simplify, or reduce, their fees. In its consultation paper on adopting the omnibus account structure, CDP mentioned that it will review its fees.<h2>Topa: Is there much happening with T+1 in Singapore?</h2>Gan: The current settlement cycle for securities trading in Singapore is on a T+2 basis and there is currently no definitive date for a T+1 transition. While industry consultations are ongoing, we do not expect Singapore to adopt T+1 until Europe has gone live in October 2027.<h2>Topa: Singapore is making a lot of progress on digital assets - please explain what the country is doing in this space.</h2>Gan: Singapore is an innovation-leader - and always has been! The country is looking to speed up the adoption of digital assets and transform into a digital asset trading hub. It is doing this by introducing sensible regulatory policies to enable innovation and collaborating with the industry on relevant projects.On the regulatory side, the MAS has created a supervisory framework for digital payment token (DPT), e.g. crypto-currencies service providers including custodians. The rules, which were phased in between April 2024 and January 2025, require DPT service providers to be fully licensed, subject to external audits, and have in place robust anti-money laundering (AML) and counter-terrorist financing (CFT) controls.Singapore has a long and impressive track record in digital asset initiatives. Project Guardian is perhaps the most well-known. As part of Project Guardian, the MAS, alongside a number of leading financial institutions, are exploring potential applications in De-Fi and testing the feasibility of asset tokenisation, a market which Boston Consulting Group and Ripple estimates will reach $19 trillion by 2033.6Progress is also happening on tokenization. There have been multiple examples of bonds and funds - including Variable Capital Company vehicles - being tokenized on blockchain networks in Singapore. The MAS is also actively involved in Central Bank Digital Currency (CBDC) and distributed ledger technology (DLT) pilots, exploring how these technologies can be used to support cross-border payments and securities settlements.<h2>Topa: How is Citi Investor Services supporting clients with the rollout of digital assets?</h2>Gan: Citi believes blockchain and digital assets will transform financial markets and we are committed to supporting our clients in this space. In fact, according to our latest Citi Securities Services Evolution 2025 whitepaper, 10% of market turnover is expected to be conducted using either tokenized or digital native securities within the next five years.7There are several digital asset initiatives underway within Citi's Investor Services business, including but not limited to acting as an issuing and paying agent for digital bonds, tokenization of real-world assets, such as alternatives, fixed income and cash deposits, and digital asset custody. In fact, we plan to launch digital asset custody in the US market later this year.However, digital assets and blockchain adoption will present challenges for clients due to:<ul style="list-style-type:disc;"><li>The emergence of new data models;</li><li>Complex technical, security and lifecycle management requirements;</li><li>Fragmentation of liquidity, markets and standards;</li><li>The need for interoperability between new and existing markets;</li><li>Changing technology and processes; and</li><li>Evolving regulatory frameworks.</li></ul>To address this, Citi is focused on minimizing barriers to adoption for clients by integrating digital asset services, such as custody, with backwards compatibility into existing systems. At the same time, we are helping clients to enhance their current processes and reporting to accommodate new digital assets and capabilities.<hr>1 SGX- November 19, 2025 – <a href="https://www.sgxgroup.com/media-centre/20251119-sgx-group-introduce-global-listing-board-landmark-partnership-nasdaq" target="_blank">SGX Group to introduce Global Listings Board in Landmark partnership with Nasdaq</a> 2 MAS- January 9, 2026 – <a href="https://www.mas.gov.sg/news/media-releases/2026/mas-proposes-legislative-and-regulatory-changes-to-facilitate-dual-listings-on-global-listing-board" target="_blank">MAS proposes legislative and regulatory changes to facilitate dual listings on Global Listing Board</a> 3 MAS- January 9, 2026 – <a href="https://www.mas.gov.sg/news/media-releases/2026/mas-proposes-legislative-and-regulatory-changes-to-facilitate-dual-listings-on-global-listing-board" target="_blank">MAS proposes legislative and regulatory changes to facilitate dual listings on Global Listing Board</a> 4 <a href="https://regco.sgx.com/regco/public-consultations/20260130-consultation-paper-modernisation-singapores-post-trade-custody" target="_blank">SGX Consultation – Consultation Paper Modernisation Singapore’s Post Trade Custody</a> 5 The Value Exchange – Tomorrow’s post-trade Operating model in Asia 6 <a href="https://ripple.com/ripple-press/global-financial-infrastructure-entering-a-new-era/" target="_blank">Global Financial Infrastructure Entering a New Era As Tokenized Assets Set to Surge to $19 Trillion by 2033</a> 7 <a href="https://www.citibank.com/icg/sa/flippingbook/2025/Citi-Securities-Services-Evolution-2025/22/" target="_blank">Citi Securities Services Evolution</a> 2025

In this latest edition of our “Where Can We Take You?” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, talks to Lai Chun Gan, Singapore Custody Head at Citi, about Singapore’s market transformation.

Where Can We Take You? Singapore

This article highlights the following key developments in Japan's financial markets:<ul><li>A cautious and deliberate consideration of a T+1 settlement cycle for equities. While the transition is being explored, it is not expected in the near future and likely not before 2030, with significant challenges posed by time-zone differences and existing issues with late trade instructions</li><li>Proposed adjustments to the clearing framework by the Japan Securities Clearing Corporation (JSCC). This would allow non-resident investors to clear over-the-counter (OTC) Japanese Government Bond (JGB) transactions for the first time, a major shift from the current domestic-only model</li><li>Significant structural changes in the digital asset space, including potential tax reforms to apply a flat 20% rate on trading profits and new stablecoin regulations under the Payment Services Act, which impose stricter collateral requirements for issuers, effective June 2026</li></ul>

Overseas investors are once again flocking to Japan, attracted by the country’s stabilizing political outlook,&nbsp;interest rate normalization and ongoing commitment to corporate governance reform. As more global&nbsp;institutions pivot towards Japan, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, talks&nbsp;to Jirawatana Chaitantipongse (Eddie), Japan Custody Head at Citi, about some of the post-trade reforms&nbsp;shaping the local market, in this latest edition of our “Where Can We Take You” series.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:400/400;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="Photo of Marcello Topa, Head of Global Advocacy for Investor Services at Citi" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:887/813;border-radius:10px;width:32.35%;" src="/rcs/citigpa/storage/public/Eddie-Jirawatana-Chaitantipongse.jpg" width="887" height="813">Jirawatana Chaitantipongse Japan Custody Head, &nbsp;Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h2>Topa: As with many other markets, Japan is contemplating a transition to T+1. What is the latest update here?&nbsp;</h2>Chaitantipongse: A move to T+1 for equities is currently being considered in Japan.&nbsp;Over the last 12–18 months, Japan’s Financial Services Agency (JFSA), the Tokyo Stock Exchange (TSE), Japan Securities Depository Center (JASDEC) – the local Central Securities Depository (CSD) – and the Japan Securities Dealers Association (JSDA) have all been consulting with custodians, brokers and asset managers about potentially transitioning to a T+1 settlement cycle for equities.&nbsp;Citi supports the industry’s exploration of a T+1 settlement cycle in Japan and has begun to assess the operational, liquidity, and risk management implications. The firm is engaging with regulators, FMIs, and market participants to contribute practical input on areas such as settlement cut‑off times, funding and FX processes, and post‑trade automation —areas that have been consistently highlighted as key considerations by market participants.Although we anticipate Japan will eventually move to T+1, it will most likely not happen in the near future, and not before T+1 is adopted in Australia (expected to occur in 2030 once their CHESS migration is finalized).&nbsp;<h2>Topa: What are some of the potential challenges to rolling out T+1 in Japan?</h2>Chaitantipongse: While we firmly believe that a shorter settlement cycle will help reduce settlement and counterparty risk, and usher in collateral optimization and liquidity benefits, the appetite in Japan remains subdued. There are several reasons for this.&nbsp;Firstly, the time-zone differences between Japan and other major markets will have a big impact on settlement completion rates. With less time to settle Japanese trades on behalf of, say, US clients, the risk of settlement failures will increase, leading to added costs.Even in the current T+2 settlement cycle, 50% of trade fails in Japan occur because of late instructions, a problem that is only going to get worse once T+1 is adopted.1This makes for continued opportunities to further automation and improve the split settlement model in the local market. In this split settlement model, onshore institutions match trades using proprietary messaging systems or email whilst foreign firms typically rely on Swift MT564 messages, creating reconciliation gaps and duplication.2&nbsp;<h2>Topa: Let’s pivot away from trade settlements and talk a bit about clearing. Japan is also making adjustments to its clearing framework. Can you share an overview?&nbsp;</h2>Chaitantipongse: The Japan Securities Clearing Corporation (JSCC) has proposed a framework that would allow non-resident investors to clear Japanese Government Bond (JGB) over-the-counter (OTC) transactions, e.g. cash and repos, indirectly through an agency clearing participant. This is a major shift, as JGB OTC clearing services were previously only available to domestic investors.&nbsp;However, a few issues need to be ironed out first by the JSCC and the local industry before this proposal can become a reality. For example, repo obligations cannot be netted, leaving clearing members at risk of being saddled with punitive capital charges and this will need to be resolved.<h2>Topa: Citi has a lot of experience with third-party clearing in Japan. Please share a bit of color on how we’ve supported clients in the past.&nbsp;</h2>Chaitantipongse: Citi’s third-party clearing (TPC) service supports clearing and settlement of cash equities, across both exchange-traded and OTC transactions. Our TPC service handles everything from trade novation and margining to settlement and fail management at JSCC, saving clients from having to build these systems themselves.&nbsp;Not only does this free up internal resources, but our TPC service helps clients mitigate costs associated with full CCP membership. Users are also able to obtain liquidity and collateral benefits, as our TPC service provides them with access to credit lines and default fund optimisation.<h2>Topa: Japan is doubling down on digital assets. What is going on in this space locally?&nbsp;</h2>Chaitantipongse: Japan’s digital asset market is going through some structural changes such as tax reforms, as the country looks to cement its credentials as a digital asset hub. Today, earnings derived from digital asset trading are counted as income tax at both an individual and company level. This can result in certain individuals, particularly high earners, being hit with tax surcharges of up to 55%.3 Industry discussions are underway regarding a revised framework that would apply a flat 20% tax rate to digital asset trading profits, aligning them more closely with the treatment of equities and bonds. Such an approach could simplify tax outcomes and improve consistency across different types of financial investments.<h2>Topa: Stablecoin regulation is also an area of focus in Japan. Could you please elaborate on this?</h2>Chaitantipongse: Stablecoins are a hot topic in Japan, and for good reason too – given the asset class’s astronomical growth potential. Citi, for example, anticipates that stablecoin issuances, in a base case scenario, could hit $1.9 trillion by 2030, fuelled by the recent changes in global policy.4Local regulators are keen to promote best practices around stablecoins.&nbsp;Since 2023, stablecoins have been regulated in Japan under the Payment Services Act, which among other things, stipulates that only licensed financial institutions – namely banks, trust companies and fund transfer service providers – can issue stablecoins, whilst those providing custody solutions must be registered with the JFSA.&nbsp;In 2025, JFSA announced amendments to the Payment Services Act, tightening up the collateral eligibility criteria for stablecoin reserve assets. Under the new rules, scheduled to take effect in June 2026, eligible collateral will be limited to cash and demand deposits, JGBs, redeemable term deposits, and high grade foreign-issued bonds, while the total outstanding amount of those bonds cannot be less than 100 trillion JPY.5 Sensible regulations and robust controls are playing a key role in stimulating stablecoin demand in Japan.<h2>Topa: Citi plays an integral role in supporting best practices in Japan. What are we doing in the local market and can you share some success stories?</h2>Chaitantipongse: Client engagement and advocacy are at the heart of what Citi does.&nbsp;We have facilitated and accompanied local FMI representatives to global financial centres such as London, Hong Kong, Singapore and Australia, providing them with valuable insights into industry transformations, such as operational modernization and settlement compression.&nbsp;We also regularly conduct educational client seminars on Japanese market intricacies such as pledge rules, proxy voting processes, and JASDEC’s matching requirements.&nbsp;Our advocacy efforts in Japan continues to drive meaningful change across the industry, which was recently illustrated by our resolution of consumption tax inconsistencies. One such change has been in the handling of consumption tax which non-resident investors are now exempted from across both transaction and custody services.&nbsp;<hr>1 Broadridge – <a href="https://www.broadridge.com/resource/capital-markets/t-plus-1-in-japan-forging-a-new-industry-model" target="_blank">T+1 in Japan: Forging a new industry mode</a> 2 Broadridge – <a href="https://www.broadridge.com/resource/capital-markets/t-plus-1-in-japan-forging-a-new-industry-model" target="_blank">T+1 in Japan: Forging a new industry mode</a> 3&nbsp;<a href="https://www.nagashima.com/en/publications/publication20260316-1/" target="_blank"> Nagashima Ohno &amp; Tsunematsu – March 2026 – Japan’s 2026 Tax reform on Taxation of Crypto asset transactions and its implications for foreign investors&nbsp;</a> 4 Citi - September 2025 – <a href="https://www.citigroup.com/rcs/citigpa/storage/public/GPS_Report_Stablecoins_2030.pdf" target="_blank">StableCoins 2030: Web3 to Wall Street</a> 5 <a href="https://www.fsa.go.jp/news/r7/sonota/20260126/01.pdf" target="_blank">https://www.fsa.go.jp/news/r7/sonota/20260126/01.pdf</a>

In this latest edition of our “Where Can We Take You?” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, talks&nbsp; to Jirawatana Chaitantipongse (Eddie), Japan Custody Head at Citi, about some of the post-trade reforms shaping the local market.

Where Can We Take You? Japan

<ul><li data-list-item-id="eda76ef9d78e1669c2faf030a9d7d8c0e">Nigeria is accelerating its market reforms with an ambitious plan to adopt a T+1 settlement cycle by June 1, 2026, a timeline significantly more compressed than in other global markets and just six months after its T+2 transition</li><li data-list-item-id="e39dd0adf925a3669f205082025e87a84">This rapid shift poses considerable operational hurdles, primarily due to the market's reliance on manual processing and non-standardized broker contract notes, which interfere with the automated pre-matching required for a shorter window. However, the country's modest trading volumes are expected to help cushion the transition</li><li data-list-item-id="e59a2e48908ca99099bd6ac674401e627">To mitigate these challenges, regulators have implemented practical solutions such as extending the settlement cutoff time to 17:00 HRS and mandating standardized broker notes. These measures are part of a broader series of reforms to boost market efficiency, alongside extended trading hours and Nigeria's upgrade to "frontier" market status by FTSE Russell</li></ul>

Nigeria’s capital markets are in a period of rapid transformation, marked by a continuous drive for reform. From shortening settlement cycles to extending trading hours, the market’s momentum is palpable. In this latest edition of our “Where Can We Take You” series, Marcello Topa, Head of Global Advocacy for Investor Services at Citi, speaks to Masha Maharaj, Sub-Saharan Africa Custody Head at Citi, to unpack these upcoming changes.<figure class="table"><table><thead><tr><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th><th style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</th></tr></thead><tbody><tr><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:400/400;border-radius:10px;width:30%;" src="/rcs/citigpa/storage/public/marcello-topa-citi.jpg" alt="Photo of Marcello Topa, Head of Global Advocacy for Investor Services at Citi" width="400" height="400">Marcello Topa Global Head of Advocacy Investor Services, Citi</td><td style="border-style:none;text-align:center;width:350px;"><img class="image_resized" style="aspect-ratio:1596/1588;border-radius:10px;width:32.35%;" src="/rcs/citigpa/storage/public/Masha-Maharaj.jpg" width="1596" height="1588">Masha Maharaj Sub-Saharan Africa Custody Head, Citi</td><td style="background-color:hsl(0, 0%, 100%);border-style:none;text-align:center;">&nbsp;</td></tr></tbody></table></figure><h2>Topa: Nigeria recently moved from a T+3 to a T+2 settlement cycle. How did that transition unfold, and what were the key takeaways?</h2>Maharaj: It has indeed been a significant step. The Central Securities Clearing System Plc. (CSCS), Nigeria’s Central Securities Depository (CSD), initially had an ambitious goal to leapfrog directly from T+3 to T+1. However, after consultation with Citi and other local market participants, the industry consensus was to take a more phased approach. The Nigerian regulator, the Securities and Exchange Commission (SEC), and the CSCS onboarded this advice. As a result, the market adopted a T+2 settlement cycle on November 28, 2025.&nbsp;The rollout of T+2 in Nigeria was remarkably smooth, largely because the industry was well-prepared. In the lead-up, Citi collaborated closely with the CSCS, the SEC, and the Nigerian Exchange Group (NGX) to carry out extensive industry-wide testing, ensuring that investors were ready for the transition. This move not only enhanced operational efficiency and market liquidity but also aligned Nigeria more closely with the global trend toward shorter settlement cycles.1<h2>Topa: Following the successful T+2 implementation, the market is already planning a move to T+1 this year. What is driving this rapid timeline, and what are the potential challenges?</h2>Maharaj: That is correct – the CSCS has confirmed Nigeria will go live with T+1 on June 1, 2026, just 6 months after launching T+2. While Citi fully supports the global move to T+1, it is crucial that markets are operationally ready for such a transition. Nigeria may encounter some challenges with the accelerated timeline. Firstly, the local market relies heavily on manual processing with emails and file transfers still the norm, whilst broker contract notes remain non-standardized, which will make it harder for the industry to deliver automated pre-matching.&nbsp;The time-window for complying with T+1 in Nigeria is also very narrow, at least relative to what other major markets went through. The US SEC, for instance, formally announced the deadline for T+1’s implementation a full 15 months before the go-live date, whereas the timeline in Nigeria is a lot more compact.&nbsp;However, Nigeria’s relatively modest trading volumes should help cushion the market’s transition to T+1, mitigating some of the operational pressures that may arise during the adjustment period.&nbsp;<h2>Topa: Given these hurdles, what practical steps are being taken to ensure a successful T+1 implementation, and how is Citi supporting its clients through this change?</h2>Maharaj: We are seeing good progress. As part of our advocacy efforts, Citi is working closely with industry associations, including the Association of Global Custodians and the Association of Asset Custodians of Nigeria.&nbsp;A key development has been the agreement by the SEC and CSCS to move the market settlement cutoff time from 08:00 HRS to 17:00 HRS. This comes not long after Citi submitted a white paper to the SEC highlighting that the original 08:00HRS settlement cut off time, while workable in a T+2 environment, would not be practical in a condensed T+1 settlement window.&nbsp;To support this accelerated timeline, the Exchange has collaborated with brokers to standardize broker contract notes and has mandated that these notes be transmitted to custodians and clients within one hour of the close of the trading window. This would significantly augment pre-matching capabilities. Longer-term, CSD connectivity and automation need to be improved, possibly through the introduction of Application Programming Interfaces (API), a shift that would help the industry enhance its pre-matching.&nbsp;While timelines may prove challenging, we are committed to supporting our clients regardless of the timeline. We are ramping up our client communications through webinars, written updates, and bilateral meetings.<h2>Topa: Looking beyond settlement cycles, what other significant reforms are shaping the Nigerian market?</h2>Maharaj: Settlement reform is just one piece of the puzzle. On April 27, 2026, the NGX extended its equities trading hours, which could usher in greater liquidity. This came shortly after FTSE Russell announced it would be upgrading Nigeria’s equity market from “unclassified” to “frontier” status.2 However, the later market close also risks causing friction for global investors when T+1 takes effect, as it will give them less time to carry out their post-trade processing and FX funding.&nbsp;Elsewhere, the CSCS is hoping to launch a single account structure and has also outlined new insolvency procedures for custodian banks, both of which are pending SEC approval.&nbsp;The Central Bank of Nigeria (CBN) has provided Citi with a temporary Bank Verification Number waiver for selected foreign portfolio investors, the provision of which is normally mandatory when investors open up cash accounts in Nigeria.&nbsp;There is ongoing engagement with the CBN and the Nigeria Revenue Service (NRS) on the modalities for the collection of withholding tax for Nigeria Treasury bills (NTB) at source during the issuance process or at the trading point. And finally, FMDQ Group is planning to unveil a new equities market segment, complementing NGX, although this is still a work in progress.<hr>1 CSCS – November 28, 2025 – <a href="https://www.cscs.ng/2025/11/cscs-announces-go-live-of-t2-settlement-cycle-in-capital-market/" target="_blank">CSCS announces go live of T+2 settlement cycle in capital market</a> 2 Bloomberg – April 18, 2026 – <a href="https://www.bloomberg.com/news/articles/2026-04-18/nigeria-expands-stocks-trading-hours-after-frontier-index-return" target="_blank">Nigeria expands stock trading hours after frontier index return</a>

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