The Depository Trust & Clearing Corporation'(DTCC) has begun implementing a new system which aims to reduce risk and transform the settlement process.

DTCC, through its subsidiaries, provides clearance and settlement services trades done on the New York Stock Exchange, Nasdaq, the American Stock Exchange and for all regional exchanges and electronic communications networks (ECNs) in the United States, amounting to more than $1.4 trillion each day.

The Depository Trust Company, a DTCC subsidiary, a DTCC subsidiary, will run the Investment Management System which is being installed in phases with plans extending into 2005.

Some of the current features of the product include:

Introduction of a new "passive authorization" that enables customers to direct that institutional trades be processed automatically, unless exempted by the customer. This is in addition to the existing "active authorization" option where trades are processed only when authorized by the customer.

Use of a "passive authorization profile" or "active authorization profile" for different types of securities including equity, municipal debt, corporate debt, and money market instruments.

A new profiling system, which allows customers greater control over the timing and order of their deliveries by transaction types and asset class via pre-defined profiles.

The automatic re-introduction for processing and settlement of institutional and account transfer transactions that were dropped or failed to settle during an earlier cycle.

New features will include the ability to accept settlement dates up to several months in advance, increased control and timing over transactions, including night deliver orders (NDOs) and broker-to-broker balance orders.  

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