Australian stock exchange targets 2029 for phase two of trading software overhaul

AUSTRALIAN bourse operator ASX said on Tuesday (Nov 26) it aimed to implement the second phase of its clearing and settlement software overhaul by 2029, with projected costs ranging between A$270 million (S$236 million) and A$320 million.

ASX added that it was working towards the delivery of the first release – the clearing service – in 2026, with costs currently expected to be at the upper end of the previously estimated A$105 million to A$125 million range.

The company’s shares fell as much as 4 per cent by 0006 GMT, making ASX one of the top losers in the benchmark index, which was down 0.3 per cent.

ASX had been looking to replace its ageing all-in-one Clearing House Electronic Subregister System (Chess) software using blockchain-based technology but abandoned the overhaul in November 2022, six years after it was announced, citing concerns about the product’s complexity and scalability.

Last year, ASX had hired Tata Consultancy Services to overhaul the Chess software, opting for a more cautious, two-stage product-based route that would require less customisation.

ASX said the 2029 timeline for the second phase, which includes the settlement and sub-register services, was decided after “extensive industry consultation” and will allow time for readiness activities.

The update comes amid a lawsuit filed by the Australian Securities and Investments Commission accusing ASX of telling the public that the initial upgrade of its clearing and settlement platform was on track when it was beset with delays.

The regulator is seeking an unspecified fine and the company has filed its defence in the proceedings.

The higher staffing costs to support regulatory commitments also pushed up the exchange operator’s expenses by nearly 15 per cent in fiscal 2024, leading to a lower-than-expected underlying profit. REUTERS

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