Settlement at DTC occurs each business day at approximately 4:15 p.m. eastern standard time. This is when the cash is moved through the Federal Reserve Bank of New York on behalf of all of the transactions that were processed and completed that day. These cash movements are facilitated through Settling Banks who act on behalf of their account as well as brokers who choose to settle through them. The money associated with the movement of more than 1.3 million transactions a day is accomplished through approximately 70 transfers via the Federal Reserve’s National Settlement Service (NSS) each day.
Although the actual settlement process begins with the posting of final settlement figures at approximately 3:45 p.m. eastern time each day, DTC operates a settlement system that provides clients and Settling Banks with online reports throughout the processing day. These reports reflect intraday gross debits, gross credits, and the net debit or credit for each client, as well as a net-net figure for each Settling Bank. The end-of-day net-net settlement balance for each Settling Bank that settles on behalf of more than one client is the net of the net debit and net credit balances of all clients for which that Settling Bank settles, after cross-endorsement with the National Securities Clearing Corporation (NSCC), including the Settling Bank’s own settlement obligations as a client if it settles for itself.
Example:
A broker/bank looks at their net debit or net credit consolidated balance in their Settlement Web Participant Account Statement.
For more information:
- The Settlement Web Help. Refer to the Settlement Statements section.