Securities settlement
Why is my settlement instruction unmatched (NMAT)?
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NMAT means the CSD or account servicer could not pair your settlement instruction with your counterparty’s instruction, so it cannot settle. The status arrives in an MT548 as :25D::MTCH//NMAT (or in sese.024 under MtchgSts/Umtchd), usually with a reason code that names the field that does not agree. Fix the field on the side that is wrong and the instructions match.
What it means
Most markets settle only matched instructions. You instruct your custodian (MT540 to MT543, or sese.023 when you connect directly to the CSD). The custodian instructs the CSD. Your counterparty does the same on the other side. The CSD then compares the two instructions field by field. When every matching field agrees, the pair is matched and becomes eligible for settlement on the intended settlement date. Until then each instruction is reported as unmatched.
In T2S, the platform used by most euro area CSDs, matching runs in real time through the business day. The fields fall into three groups. Mandatory matching fields must be present in both instructions and agree. Additional matching fields only count once one side fills them in: from then on the other side must carry the same value. Optional matching fields can match against a blank, but if both sides fill them in they must agree. The table below lists them with the MT and MX fields that carry them.
For against-payment instructions T2S allows a small difference in the settlement amount: EUR 2 when the amount is EUR 100,000 or less, and EUR 25 above that (ECB T2S programme office; the same bands appear in the NBB-SSS matching rules). When two instructions match within the tolerance, the NBB-SSS rules state that the deliverer’s amount is used for settlement. Markets outside T2S set their own tolerance, so check your custodian’s market guide.
NMAT is not final. Matching keeps being retried as long as the instruction is live. In T2S an instruction that is still unmatched 20 business days after the intended settlement date (or after its last status change) is cancelled by the system, so an unmatched trade left alone will eventually disappear.
Common causes
- The counterparty has not instructed yet, or instructed at a different CSD or custodian. The reason is CMIS (no matching instruction found). This is the most common cause on the day of the trade.
- A settlement amount difference above the tolerance: commission, fees, accrued interest or rounding calculated differently on each side. Reason DMON; a different currency gives NCRR.
- Settlement date or trade date booked differently, often after an amendment or a holiday calendar difference. Reasons DDAT and DTRD.
- Quantity mismatch, including units against face amount for a bond, or a partial allocation booked as the full block. Reason DQUA.
- The wrong counterparty agent or CSD in the settlement chain: an end client’s BIC in
95P::DEAGinstead of the CSD participant, or a stale standing settlement instruction. Reasons ICAG, DEPT, ICUS and IEXE. - Different ISIN (a temporary line, a new ISIN after a corporate action, or a local code), direction (both sides receiving) or payment type (one side free of payment, the other against payment). Reasons DSEC, DELN and
FRAP. - One side filled in an additional matching field and the other did not, for example the opt-out indicator
NOMCor a cum/ex trade condition. ReasonsDMCTandDCMX.
How to fix it
- Read every reason in the MT548: each
:24B::NMAT//line names one field. If the reason isNARRor the narrative in:70D::REASgives the counterparty’s value, compare it with your own booking first. - If the reason is CMIS, check whether your counterparty has instructed at all. Many account servicers forward an allegement (MT578, or
sese.028in ISO 20022) when a counterparty instruction against you arrives without a match; its details show what the counterparty booked. - Compare your instruction with the trade confirmation and the counterparty’s settlement instructions, field by field, using the table below. Check the counterparty’s BIC11, the CSD in
95P::PSET, the ISIN, the quantity type (UNIT or FAMT) and both dates. - Call or message the counterparty’s settlement desk with your values. Agree which side amends. The side that booked the trade wrongly fixes it; do not copy the counterparty’s value just to force a match.
- Amend only through your account servicer’s process. In ISO 15022 that is usually a cancellation (MT540 to MT543 with
:23G:CANCand the original reference in:20C::PREV) followed by a new instruction with a new reference. Some CSDs, T2S among them, let you change processing details such as hold status or priority without re-instructing, but a matching field is changed by cancel and replace. - Watch for the next MT548:
:25D::MTCH//MACHconfirms the match. If the intended settlement date has passed by then, the late match can carry costs: in the EU a late matching fail penalty under CSDR is charged to the party that instructed last.
Matching fields and where to check them. T2S types from the ECB T2S programme office presentation on matching fields and the NBB-SSS matching rules; MT fields as used in MT540 to MT543. Rows marked "market specific" are not T2S matching fields but are matched in some other markets.
| Matching field | T2S type | MT540-543 field | sese.023 element | What to check | Reason if it differs |
|---|---|---|---|---|---|
| Payment type (against payment or free) | Mandatory | Message type: MT541/543 against payment, MT540/542 free | SttlmTpAndAddtlParams/Pmt | Both sides APMT or both FREE | FRAP |
| Securities movement (receive or deliver) | Mandatory (opposite values) | Message type: MT540/541 receive, MT542/543 deliver | SttlmTpAndAddtlParams/SctiesMvmntTp | One side RECE, the other DELI | DELN |
| ISIN | Mandatory | 35B | FinInstrmId/ISIN | Same ISIN; not an old or temporary line | DSEC |
| Trade date | Mandatory (T2S compares the date only) | 98A::TRAD in sequence B | TradDtls/TradDt/Dt/Dt | Date from the trade confirmation | DTRD |
| Intended settlement date | Mandatory | 98A::SETT in sequence B | TradDtls/SttlmDt/Dt/Dt | Same date; check holiday calendars and amendments | DDAT |
| Settlement quantity | Mandatory | 36B::SETT in sequence C | QtyAndAcctDtls/SttlmQty/Qty/Unit or FaceAmt | Same number and same type (UNIT for shares, FAMT for bonds) | DQUA |
| Counterparty CSD participant | Mandatory | 95P::DEAG (in MT541/540) or 95P::REAG (in MT543/542), sequence E1 | DlvrgSttlmPties/Pty1/Id/AnyBIC or RcvgSttlmPties/Pty1/Id/AnyBIC | The participant’s BIC11 at the CSD, not the end client | ICAG |
| CSD of the counterparty | Mandatory | 95P::PSET, sequence E1 | DlvrgSttlmPties/Dpstry/Id/AnyBIC or RcvgSttlmPties/Dpstry/Id/AnyBIC | Same place of settlement on both sides | DEPT |
| Settlement amount and currency | Mandatory for against-payment instructions | 19A::SETT, sequence E3 | SttlmAmt/Amt and SttlmAmt/CdtDbtInd | Difference within the tolerance; same currency | DMON, NCRR |
| Cum/ex indicator | Additional | 22F::TTCO//CCPN or //XCPN, sequence B | TradDtls/TradTxCond/Cd | Filled in on both sides or on neither | DCMX |
| Opt-out of market claims | Additional | 22F::STCO//NOMC, sequence E | SttlmParams/SttlmTxCond/Cd | Filled in on both sides or on neither | DMCT |
| Common reference | Optional | 20C::COMM, sequence A1 | SttlmTpAndAddtlParams/CmonId | If both sides send it, the same value | IIND |
| Client of the counterparty’s CSD participant | Optional | The party below DEAG or REAG in sequence E1, for example 95a::SELL or ::BUYR, or ::DECU or ::RECU in a longer chain | DlvrgSttlmPties/Pty2/Id or RcvgSttlmPties/Pty2/Id | If both sides send it, the same BIC or proprietary code | IEXE, ICUS |
| Counterparty’s securities account | Optional | 97A::SAFE in the DEAG or REAG block, sequence E1 | DlvrgSttlmPties/Pty1/SfkpgAcct/Id or RcvgSttlmPties/Pty1/SfkpgAcct/Id | If both sides send it, the same account | SAFE |
| Deal price | Market specific | 90a::DEAL, sequence B | TradDtls/DealPric | Same price where the market matches on it | DDEA |
| Place of trade | Market specific | 94B::TRAD, sequence B | TradDtls/PlcOfTrad | Same venue code where the market matches on it | PLCE |
| Settlement transaction type | Market specific | 22F::SETR, sequence E (for example TRAD) | SttlmParams/SctiesTxTp/Cd | Same type where the market matches on it | SETR |
Example
The custodian CUSTGB2LXXX tells ZagTrader Test Bank (ZAGTAEADXXX) that its receipt against payment of EUR 1,000,000 face of a bond is accepted but unmatched. The counterparty instructed EUR 998,250.00 against EUR 998,000.00 on our side, outside the tolerance.
{1:F01CUSTGB2LAXXX0000000000}{2:I548ZAGTAEADXXXXN}{4:
:16R:GENL
:20C::SEME//ST26102100042
:23G:INST
:98C::PREP//20261021093015
:16R:LINK
:13A::LINK//541
:20C::RELA//ZT26102000017
:16S:LINK
:16R:STAT
:25D::IPRC//PACK
:16S:STAT
:16R:STAT
:25D::MTCH//NMAT
:16R:REAS
:24B::NMAT//DMON
:70D::REAS//COUNTERPARTY SETTLEMENT AMOUNT
EUR 998250,00
:16S:REAS
:16S:STAT
:16S:GENL
:16R:SETTRAN
:35B:ISIN XS00ZAGT0013
ZAGTRADER TEST 4.25PCT 2031
:36B::SETT//FAMT/1000000,
:19A::SETT//EUR998000,00
:97A::SAFE//ZAG-SAFE-0001
:22F::SETR//TRAD
:22H::REDE//RECE
:22H::PAYM//APMT
:98A::SETT//20261022
:98A::TRAD//20261020
:16R:SETPRTY
:95P::PSET//ICSDLULLXXX
:16S:SETPRTY
:16R:SETPRTY
:95P::DEAG//BRKRGB2LXXX
:16S:SETPRTY
:16S:SETTRAN
-}Open this example in the parser:20C::RELA carries the reference of the instruction being reported (the :20C::SEME of your MT541).
Two status blocks: IPRC//PACK says the instruction passed validation, MTCH//NMAT says it is not matched. Each reason sits in its own REAS block.
The 250.00 difference is above the T2S tolerance of EUR 25 for amounts over EUR 100,000; other places of settlement apply their own tolerance.
BICs, ISIN and references are made up.
Questions
- What does NMAT mean in an MT548?
- NMAT (Unmatched) is a matching status in
:25D::MTCH//NMAT. Your instruction has been accepted but the CSD has not found a counterparty instruction that agrees on every matching field. The:24B::NMAT//reason says which field differs, or CMIS if no counterparty instruction was found at all. - What is the matching tolerance on the settlement amount in T2S?
- EUR 2 when the settlement amount is EUR 100,000 or less and EUR 25 above EUR 100,000, as published by the ECB T2S programme office and repeated in CSD matching rules. Other currencies and markets have their own figures, so ask your custodian for the market you settle in.
- Who has to fix an unmatched instruction?
- The side whose booking does not agree with the trade. Matching shows you that the two instructions differ, not who is right. Check against the trade confirmation, agree with the counterparty and let the wrong side cancel and re-instruct.
- What is the difference between NMAT and CMIS?
- NMAT is the status: the instruction is unmatched. CMIS is one of the reasons for that status: no counterparty instruction could be found. Other reasons such as DMON or DDAT mean a counterparty instruction exists but one field disagrees.
- What happens if an instruction stays unmatched?
- It cannot settle. In T2S it is cancelled automatically after 20 business days from the intended settlement date or its last status change. In the EU, if it matches only after the intended settlement date, the CSD charges a late matching fail penalty under CSDR to the party that instructed last.