RBA’s Payments System Board voices concerns about ASX trading system issues
The recent tech issues plaguing the work of ASX have been high on the agenda of Australian regulators, as proven again today by the Payments System Board of the Reserve Bank of Australia.
At its meeting today, the Payments System Board discussed a number of issues, including ASX’s project to replace the CHESS clearing and settlement system for cash equities. The Board discussed ASX’s revised timeline of April 2023 for implementation of the replacement system and confirmed the Bank’s expectations of ASX in relation to the new system.
It emphasised the need for the replacement system to be implemented as soon as this can safely be achieved by ASX and users of CHESS.
The Board says it is concerned about the recent operational issues affecting CHESS and ASX’s trading systems. It will be working to understand if there are systematic underlying issues.
After trading opened in Sydney on Monday morning this week, a number of problems were quickly experienced in the provision of market data, quotes, and then execution of orders. At 10:24am the ASX issued a “Critical Operation Impact” status notice indicating a halt in all trading on the ASX.
After a number of additional market-remains-halted notices, at 14:58 the ASX posted that the markets would remained closed for the remainder of the day. It said that the underlying cause of the issue was identified, and that a resolution path is in place to allow trading to resume at 10am Tuesday as usual.
The ASX later gave some more specifics, saying that a software issue limited to the trading of multiple securities in a single order (known as combination trading) created inaccurate market data.
On Tuesday, November 17, 2020, however, after about an hour of normal operation, ASX put out a “Partial Operational Impact” notice that it was aware of data issues with its Centre Point anonymous mid-point trade matching system. It later related that, until further notice, ASX Centre Point execution prices would be based on the ASX lit best bid and offer only.