Minutes

Item 1: Welcome and introductory remarks

The Chair opened the meeting and welcomed the members and observers.

Item 2: Diversity, Equity & Inclusion

The Committee discussed the developing strategies for attracting and retaining early career talent in the securities finance industry. Development and retainment strategies aimed to provide early career staff with opportunities to diversify knowledge and experience across firms. Other initiatives included firm-wide roll out of leadership programmes driving alignment across the workforce.

Item 3: SLC Tax & Regs Update

The SLC Tax & Regulations sub-committee provided an update noting increased operational challenges created by holding-period rules and record date requirements across national tax regimes. Implementation of T+1 accelerated settlement could amplify existing issues, should firms fail to adapt. The group noted the need for greater tax harmonisation and monitoring tax-related risk across jurisdictions.

Item 4: T+1 Update

Industry participants are broadly on track for implementation in October 2027 but there are significant differences in readiness between firms. Operational challenges around securities lending recalls, collateral sourcing, funding, settlement timing, partial settlements and agent lender capabilities persist. Future competitiveness may depend on collateral agility, automation, real-time processing and the ability to support same-day operational workflows. The group noted that T+1 readiness extends beyond compliance and requires scalable operating models capable of supporting future market changes.

Item 5: Market update

The Committee made observations on business growth, capital optimisation and market evolution and discussed increased use of central counterparties, collateral efficiency mechanisms and smart collateral structures. Members highlighted growth opportunities in newer markets and the growing importance of digital asset initiatives, including the rise of tokenisation programmes. Digital collateral discussions centred on how infrastructure projects could eventually reshape financing markets. Upcoming regulatory developments, mandatory clearing requirements and operational changes could affect lenders, borrowers and investment funds over the coming years.

Item 6: Changes in the Digital Landscape

The group discussed digital assets and market infrastructure noting regulatory developments supporting tokenisation, digital securities, collateral usage, and digital market infrastructure programmes. There are multiple industry working groups examining repo, collateral mobility, payments, legal frameworks and digital securities issuance. Practical use cases remain the critical challenge. The group discussed a legal case involving the potential re-characterisation of a securities financing transaction as a secured loan, where the outcome could have significant implications for repos, securities lending and contractual certainty.

Members noted the pace of development in artificial intelligence and characterised current adoption as primarily efficiency-driven rather than fully autonomous decision-making. Use cases have tended to centre on administrative tasks, information retrieval, data aggregation, recall processing and enhanced transparency across funding and collateral books. The group discussed evolution of AI use from individual productivity tools into strategic infrastructure with the potential to influence trading activity, client selection, collateral mobility and decision-making.

Concerns remain around use of AI in governance, resilience, vendor oversight and data security, particularly if AI systems gained access to sensitive operational data.

Item 7: AOB

Attendees

M&G - Chair, Nina Moylett
Blackrock - Tim McLeod
Clifford Chance - Habib Motani
Goldman Sachs - Johanne Armita
HSBC - Jamie Anderson
ICMA - Godfried de Vidts
JP Morgan - Harpreet Bains
Morgan Stanley - Krishan Chada
MUFG - Tim Smollen
M&G Plc - Simon Dunderdale
State Street Global Markets - Matt Neville
Blackrock - Davina Stickland (Tax & Regulatory sub-committee)
Clifford Chance - Caroline Dawson (Tax & Regulatory sub-committee)
HSBC - Shikha Kalra (Tax & Regulatory sub-committee)
ISLA - Adrian Dale (Tax & Regulatory sub-committee)
Norges Bank IM - Christy Stagemeyer (Tax & Regulatory sub-committee)
Bank of England - Simon Dolan
Bank of England - Trinity Frost
Bank of England - Kirstine McMillan

Apologies

AIMA - Adam Jacobs-Dean
Barclays - Devi Aujeet
ISLA - Ina Budh-Raja
Norges Bank IM - Morten Gevoll