Local trading moved to a shorter settlement period on Monday, and so far there have been no reports of transaction failures, owing to robust broker inspection procedures led by the Jamaica Stock Exchange (JSE) ahead of the May 26 deadline.

The JSE was one of several stock exchanges to effect changes over the past few hours to comply with the US Securities and Exchange Commission’s (SEC) new rule to settle transactions within one business day after a trade, instead of the previous two-day period.

In addition to implementing the T+1 Settlement Cycle, the JSE has extended its trading hours from three and a half hours to five hours. The new trading hours are now from 9:00 am to 2:00 pm, Mondays to Fridays, providing investors with more time to buy and sell securities on the stock market, the JSE said in a notice.

“It’s modern and coincides with the global trend. In the US market they have reported small glitches, so that shows that the JSE is doing its best and that in and of itself is positive,” vice-president of GK Capital Management Limited Ryan Strachan told the Jamaica Observer. He has also long advocated for extended training hours.

Other markets such as Canada, Mexico and Argentina have reported a smooth transition. The UK is expected to come on-board in 2027, while Europe is considering the shift, but has not yet announced a timeline.

Ahead of the changes which took effect on Monday, May 27, both NCB Capital Markets Limited (NCBCM) and JMMB Investments said they were “fully prepared” for the transition with comprehensive updates across all digital systems, including their mobile and online platforms, core applications, and operational procedures.

“All NCBCM digital systems have been updated and were ready for the conversion on May 27, 2024. These channels offer ease of use and convenience to our clients as they take advantage of the longer trading hours and shorter settlement period. NCBCM’s technical and projects teams are on standby to support clients in cases of unforeseen events,” NCB said in response to queries from the Jamaica Observer.

Additionally, NCBCM said it successfully concluded the broker inspection process led by the JSE. The institutions’ technical and quality assurance teams were said to have dedicated several weeks to rigorous testing, ensuring the stability of the platforms ahead of the transition date.

NCBCM says it’s also launched a campaign to educate its clients on the changes.

“We have sensitised our teams and clients about the changes and the impact. We will continue to ensure the market is fully aware of the changes. Throughout the upcoming weeks we stand ready to support clients, should any challenges arise,” the investments institution said.

“NCBCM is committed to delivering a seamless and efficient world-class digital trading experience to our clients as we embark on this significant change,” it continued.

Meanwhile, JMMB said it has experienced seamless trading activity since the implementation of the new JSE T+1 Settlement Cycle, on Monday.

“JMMB would have implemented the necessary system updates and automation to ensure that it was ready to roll out in accordance with the updated Jamaica Stock Exchange T+1 Settlement Cycle and extended trading hours.

“Our systems update would mostly be in the back-office operations, to ensure we have the necessary human and technical resources to process more trades settlement in a shorter time frame,” it said.

Looking ahead, JMMB anticipates that the changes implemented by the JSE will encourage greater market efficiency and increase trading opportunities, aligning with investors’ liquidity needs.

“The quickness of payment turnaround ensures more liquidity in the market. It means more trading turnovers (frequency and volume) and reduced risk exposure. The extended trading time will give more investors the opportunities to trade,” JMMB said.

Similar sentiments were echoed by individual investor Leon Franscique.

“The new settlement period and extended trading hours are definitely welcomed improvements to the market,” he said.

Following the implementation of a shorter settlement time on Monday, managing director of the Jamaica Stock Exchange Dr Marlene Street Forrest said the JSE takes pride in aligning with international standards, reiterating that such a move brings significant benefits to the local market.

“I take this opportunity to thank the team for their hard work and dedication in executing a smooth transition to T+1 and the extended trading hours. This project was well-executed, and we appreciate the support and the input from the member dealers and listed companies,” she said in a notice posted on the JSE.

— Additional reporting by Dashan Hendricks