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Regulator tells Singapore bourse: Restore trading more quickly after glitches
March 20, 2017 / 10:48 AM / 9 months ago

Regulator tells Singapore bourse: Restore trading more quickly after glitches

SINGAPORE, March 20 (Reuters) - Singapore’s central bank said on Monday it has asked the Singapore Exchange to enhance its recovery processes following an investigation into a trading disruption in July last year.

At the time, trading in the securities market was suspended for several hours because duplicate trade confirmation messages were generated. Trading resumed only the next day.

That disruption was followed by another in December, when trading for some derivative contracts opened more than two hours after the scheduled start.

The frequency of the glitches have frustrated investors even as authorities try to revitalise the bourse in one of Asia’s major financial hubs.

The Monetary Authority of Singapore, the country’s central bank and SGX’s regulator, only referred to the July disruption in its Monday statement.

“MAS has determined that while SGX has met its primary obligation as an exchange to maintain fair, orderly and transparent markets, it did not restore the proper functioning of its critical system within four hours as required,” the statement said.

“MAS notes that SGX has taken steps since the incident to address the hardware and software errors which led to the trading disruption.”

The central bank directed SGX to implement within 24 months the six recommendations made by an industry group to improve restoration of corrupt data, market recovery procedures, market closure and resumption, trade assumption, incident communication and business continuity testing and support.

“MAS takes a serious view of trading disruptions,” said Ong Chong Tee, MAS deputy managing director for financial supervision.

SGX said in a statement that it has adopted all recommendations and implemented three with immediate effect.

“The recommendations that SGX has implemented include establishing a Master Record as the authoritative source of data in the event of complex malfunctions; providing more clarity on the timing and principles for market closure and resumption during a market-wide incident; and establishing a clear protocol for trade assumption,” SGX said.

In 2015, the MAS “reprimanded” SGX for lapses related to market outages in October and November 2014. SGX has since provided verification from independent experts that the remedial measures have been completed and MAS accepts their findings, the central bank statement said. (Reporting by Marius Zaharia; Editing by Richard Borsuk)

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