UK Securities Lending Market Remains Stable Ahead of T+1 Transition

The UK securities lending market has maintained stability despite recent global tensions, according to the Bank of England's Securities Lending Committee. The committee reported that industry consensus remains on track for a transition to T+1 settlement by October 2027, with some concerns raised about funding mismatches.

Despite these challenges, the market remains broadly stable, with resilient demand and increased regulatory scrutiny influencing collateral supply and participation. The committee noted that the recent global tensions have changed participant behaviour, but the market's stability is a testament to its maturity.

The committee also discussed digital assets and future market infrastructure, including regulatory alignment and the EU Market Integration and Supervision Package. This legislation aims to deepen EU capital market integration, modernise settlement finality, and provide legal certainty for Distributed Ledger Technology.