Wall Street’s Transition to Faster Trading Is Paying Off for Credit

A long-feared change to Wall Street’s plumbing is paying off — and it’s freeing up billions.

More than a year after the US adopted one-day settlement, a key measure of corporate bond trading costs is down 12%. Margin requirements — the cash or collateral firms must post to cover the risk of failed trades — have dropped 29%, according to Barclays Research. That’s capital that can now be put back to work. Plus, there are signs that those savings have boosted credit market liquidity.