The Municipal Securities Rulemaking Board, or MSRB, is seeking public comment on a proposal to facilitate shortening the settlement cycle for transactions in municipal securities in response to a securities industry-led initiative to shift the current settlement cycle for all fixed-income and equity securities from T+3 (trade date plus three days) to T+2 (trade date plus two days).

Draft changes to MSRB Rules G-12, on uniform practice, and G-15, on confirmation, clearance, settlement, would enable the first shortening of the municipal securities settlement cycle since 1995. The T+2 settlement cycle, if adopted by all relevant regulators, would apply across the securities industry, including not only municipal securities but also equity securities and corporate bonds. The initiative is being led by the Industry Steering Committee (ISC), chaired jointly by the Investment Company Institute (ICI) and the Securities Industry and Financial Markets Association (SIFMA).