EFTA00621315.pdf

Bank of America e Instinct Equities Merrill Lynch Market Structure Update - SEC Adopts T+2 Settlement Highlights • As you are aware, there has been an ongoing industry initiative towards shortening the trade settlement cycle to T+2 for several years. See V.S. T+2 Industry Steering Committee (ISC) website here. • Earlier today, the Commission voted unanimously (2-0) to adopt an amendment to Rule 15c6-1 (Settlement Cycle) that would shorten the settlement cycle to T+2. • The adoption of this rule amendment was widely expected and represented a critical milestone in the ISC Timeline (see below) to implement the T+2 settlement cycle by the end of Q3 2017. • The amended rule applies the T+2 settlement cycle to the same securities transactions currently covered by the 1+3 settlement cycle which includes: stocks, bonds, municipal securities, ETFs, certain mutual funds, and limited partnerships that trade on an exchange. • The compliance date for the amendment to Rule 15c6-1 is September 5. 2017 which is consistent with the target implementation date previously set by the ISC. • Product in scope can be found here Source: https://www.sec.gov/news/press-release/2017-68-0 Chart Source: AMRS Execution Consulting I Brad Johmann 1.646.855.3535 I Brian Liu I 1.646.855.0623 1 EFTA00621315 AMRS Market Structure News March 2017 Industry Road to T42 2015 2016 2017 Implementation • •2 Q3 g4 QI Q2 03 Q4 QI Q2 Q3 Q4 Recommend proposed rule changes to regulators Regulators offer regulatory support for the move to 1+2 Mier • Self-Regulatory Organization (SRO)' and SEC notification of Fir proposed rule changes • Comment period on proposed SRO and SEC rule changes .7 air Submission of SRO rules to the SEC for comment and approval 7 alk Release of final SRO and SEC rules "Shortening the Settlement Cycle: The Move to T+2- White Paper air published wit 1+2 industry implementation Playbook developed and published V a* 1+2 Industry Implementation Playbook socialization %/////%, Financial advisor and client1+2 education %//////1 I . ISC considers T.2 migration date %/////////////////////////i Ongoing ISC governance, oversight of industry 1+2 implementation, and creation of project management office (PM0) ISC establishes 1.2 Command Center %/////////////////////// 1 Development of Individual market participant's implementation . . plans / : Execution of individual market participant's implementation plans V allIlln* individual market participant (internal), vendor, and service bureau testing V //V // V /a*/ t A Development of DTCC high-level industry test approach r _cair . . Publication of DTCC requirements and interface changes V a* • .• Development of DTCC detailed industry test plans V a* • Coordination of vendor and service bureau tem plans vAth dients IM=MD* • DTCC and market participant readiness for industry testing * .: Round-trip Industry testing with DTCC Mae* Market participants to certify testing results ar ISC "go" or "no-go" decision to move forward V /2* 1+2 Command Center prepares for migration air industry migration to 1+2 settlement at Assessment of post-migration activities / Non-dependent Dependent * Proposed milestone Go live "4. Implementation Activity Implementation Activity AMRS Execution Consulting I Brad Johmann I 1.646.855.3535 I Brian Liu I 1.646.855.0623 2 EFTA00621316 AMRS Market Structure News March 2017 Global Market Structure Contacts Americas EMEA Asia Pacific Rim Brad Johmann Lara Shevchenko Murat Atamer 1.646.855.3535 44.20.7996.3179 852.3508.7363 Adam inzirillo Yuhang Wang Kevin Xu 1.646.743.0189 44.20.7995.1059 852.3508.3018 Brian Llu 1.646.855.0623 212.449.6090 44.20.7995.1059 852.3508.7550 Important Notice and Disclaimer BoIAML instinct x• Bank of Amenca Moral Lynch (lioMML1 operates barrel X. an Alternator* Trading Syrian l'ATS) In the VS and as a Broker Crossing Network (WW1 in other geographies. BoIAML sears to operate Ks ATS/BCM accordance withapplicableregulations. and In accordance with reasonable expectations of fairness. 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Intact•, and instinct X. are trademarks of Bank of America Corporation in the U.S. and other countries. eh 2017 Bank of AmericaCorporation. All rights reserved. AMRS Execution Consulting I Brad Johmann I 1.646.855.3535 I Brian Uu I 1.646.855.0623 3 EFTA00621317