RBA governor Philip Lowe said it expected the highest priority be given to ensuring the stability and resilience of the critical infrastructure supporting Australia’s cash equity markets.
“This needs to be the focus for current CHESS as well as in rethinking the design and implementation of its replacement. The RBA also expects to see further uplift by ASX with respect to its governance arrangements,” he said.
The ASX had been investing in the technology project since 2017 but announced in November it was being scrapped.Credit:Louie Douvis
Both regulators said they were considering further action and were “prepared to bring to bear a range of regulatory options to ensure that ASX Clear and ASX Settlement adhere to the regulators’ expectations and comply with their … obligations”.
“The regulators’ coordinated action today demonstrates the shared immediate concern that current CHESS is supported and maintained to ensure its stability, resilience and longevity so that it can continue to service the market reliably,” they said.
In a statement, ASX said it would act in accordance with the new requirements and expectations and engage with the regulators.
“Maintaining the stability, security and high performance of current CHESS, which is critical to the operation of Australia’s financial markets, is an ASX priority,” said ASX chief executive Helen Lofthouse.
“With the enhancements we have made to the system’s capacity and resilience in recent years, and the investments that we will continue to make, ASX is confident that current CHESS will serve the Australian market well into the future.”
Loading
The exchange operator announced in November that it would reassess all aspects of the CHESS replacement project following completion of an independent review, conducted by Accenture, and its own internal assessment. The costs incurred will be written off “in light of the solution uncertainty”, resulting in a charge of $245 million to $255 million pre-tax for the December half year, ASX said in a statement to investors.
The ASX had been investing in the technology project since 2017 and the go-live date had been pushed back due to a range of factors including COVID-19, complaints from the industry about lack of consultation and technological setbacks.
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.
For all the latest Business News Click Here
For the latest news and updates, follow us on Google News.
Denial of responsibility! NewsBit.us is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.
