(Bloomberg) -- Jefferies Financial Group Inc.’s roughly $3 billion of debt sales last month were partly used to prepare for potential glitches when revamped trading rules take effect next week.

A portion of the borrowing will help the investment bank build a cushion to deal with any unexpected problems with the rollout of expedited stock trading, which begins Tuesday, people familiar with the matter said. Jefferies has only said that the debt sale, common after quarterly results are released, was for general corporate purposes.

A representative for Jefferies declined to comment.

US markets are bracing for the implementation of new rules that will require trades to settle — that is, complete the exchange of payments for stock — in one day instead of the two days that has been the norm. That has spurred a bout of internal reviews as banks, brokers and investors assess their ability to handle the change and guarantee their readiness.

Industry participants are bracing for potential failed trades and technology glitches. The additional capital will give Jefferies a buffer to meet any clearinghouse demands if the other side of a trade faces hurdles in completing the expedited schedule for the transfer of payment.

Read More: Wall Street Trades Are Speeding Up and Global Finance Is On Edge

In a typical process, brokers post collateral in a fund held by the Depository Trust & Clearing Corp., the clearinghouse for stock trades. This way, both sides of a trade are protected if one party defaults. But a failure by a client to complete the trade could result in the bank’s capital getting tied up in the trade.

As technology has played a bigger role in markets, the Securities and Exchange Commission has been cutting down the time it takes for the settlement process — from about five days in the 1990s down to the current T+2 system. The T refers to “trade” or “transaction” date.

Just 9% of sell-side firms polled by Coalition Greenwich in April and May said they expect the T+1 switch to go smoothly, with 38% warning that buy-side managers are unprepared. Twenty-eight percent believe trading platforms aren’t fully ready and almost a fifth anticipate a large disruption with many or severe issues.

Read More: About the ‘T+1’ Rule Making US Stocks Settle in a Day: QuickTake

©2024 Bloomberg L.P.