Ongoing compliance is spending focus for ASX

ASX Group, which runs the Australian stock exchange, has plans to spend in order to tackle incoming compliance issues that arise in the upcoming year. The firm issued its annual results yesterday.

ASX Group, which runs the Australian stock exchange, has plans to spend in order to tackle incoming compliance issues that arise in the upcoming year. The firm issued its annual results yesterday.

In ASX’s cash markets, the exchange plans to develop execution services to reflect more complexities in its markets. It says it will focus on Centre Point trade execution enhancements, block trading improvements for large orders and repositioning of trade reporting services.

ASX has already begun margining of cash equities to reduce risk and has developed a code of practice for cash equities clearing and settlement, including formal stakeholder engagement via a new forum.

As Trade Asia has previously reported, in February 2013, the government said it would defer consideration of any new licence application for clearing and settlement for two years. It meant that the existing market structure for cash equities clearing and settlement would continue as an ASX monopoly.  

Plans in derivatives markets are to expand the core product offering, plus VIX and specific sector futures. It will continue to work on over-the-counter clearing of interest rate derivatives for dealers and client level clearing for OTC derivatives and futures.

Earlier this summer, ASX raised A$553 million in new equity. Most of the new equity will be used to directly support ASX’s clearing operations. The remainder will be used to support current and future growth initiatives and other subsidiaries such as ASX Clear (Futures), an entity which has been told by the central bank it now has to match European capital standards.

 

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