DST Reduces Rejects on
T+1 Redemptions

As part of an on-going effort to reduce the overall number of rejected Fund/SERV transactions, DST has identified an opportunity to improve the processing of current date T+1 redemptions. 

Today, an intermediary can submit a transfer (through ACATS or Networking B52) on the same day as they submit a T+1 redemption from the account that’s receiving the transfer.  However, since transfer transactions are not received at DST until the evening, a T+1 redemption received intra-day at DST may be rejected due to insufficient shares.  As a result, the intermediary must submit an as-of T+1 redemption the next day, causing a delay in processing and a potential gain/loss situation.

Starting in September 2008, DST will accept certain current date T+1 redemptions that previously would have been rejected intra-day for insufficient shares.  If the T+1 redemption is funded the same day, DST will confirm the transaction post-nightly.  If the T+1 redemption is unable to be processed the same day, DST will reject the transaction post-nightly. 

This new functionality will result in fewer rejects and fewer as-of transactions for the intermediary!