WASHINGTON, March 16 (Reuters) - U.S. securities regulators are poised to shorten the amount of time it takes for a securities trade to settle, from three to two business days, in an effort to reduce credit and market risk exposure.
The Securities and Exchange Commission announced it will hold a public meeting to vote to adopt a final rule next Wednesday.
Wall Street is largely in favor of shortening the amount of time it takes from the time an investor's order is executed to when cash and ownership of the security are exchanged.
Consumer groups are also supportive of the effort, though some would prefer to see it shortened even more to just one day to help further reduce risks.
The current settlement cycle required by SEC rules has not been updated since 1993.
Thomson Reuters Corp, the parent company of Reuters, previously submitted a comment letter to the SEC in support of the proposal to shorten the settlement cycle to two days. Reporting by Sarah N. Lynch; Editing by Paul Simao