NASDAQ OMX Iceland has decided, following a consultation among market participants, to change the settlement cycle for all securities traded on its Main Market and First North Iceland to two days (T+2). The settlement cycle for equities will, thus, be shortened by one day (is currently T+3) but the settlement cycle for fixed-income instruments will be lengthened by one day (is currently T+1). The new settlement cycle will be implemented on 6 October 2014. As previously announced, the other NASDAQ OMX Nordic and Baltic exchanges will also implement T+2 settlement on that day.
The reason for the change in the settlement cycle is twofold. First, harmonization with other European markets as the settlement cycle will be changed to T+2 later this year in many European countries in relation to the implementation of the EU CSD regulation. Secondly, the aim is to improve efficiency in the Icelandic securities market by harmonizing the settlement cycle for the Icelandic equity, fixed-income and FX markets.