Bourse operator ASX flags $172 million hit from clearing software replacement halt

Follow us on Google News:

(Reuters) - Australian bourse operator ASX Ltd said on Thursday it would take a pretax charge of up to A$255 million ($172 million) in the first half, as it derecognises the software being developed to replace its ageing clearing and settlement system.


The replacement has been halted following a review of the project and independent findings that led ASX to conclude there were "significant technology, governance, and delivery" challenges.

The software was intended to replace ASX's Clearing House Electronic Subregister System (CHESS) to improve functionality and efficiency, and adopt global standards, the bourse says on its website.

"It's clear we need to revisit the solution design as well as validate and test the feedback from the independent review to assess changes required to bring the project to market safely, efficiently and for the long-term," Chief Executive Officer Helen Lofthouse said.

All current activities on the replacement project have been paused as ASX revisits the solution design, the bourse said. It added that the current CHESS remains secure and stable, and is performing well.

The bourse said the one-off charge of between A$245 million and A$255 million will have no impact on its dividends, and that it maintains its dividend policy of 90% of its underlying net profit after tax.

It also appointed Tim Whiteley, a technology transformation executive, as the new project director for the next phase of the replacement project.

($1 = 1.4841 Australian dollars)

(Reporting by Sameer Manekar in Bengaluru; Editing by Maju Samuel and Shailesh Kuber)

Disclaimer

The above content is directly sourced from Reuters under a contractual arrangement. The content is being provided as a convenience and for informational purposes only; and does not constitute an endorsement or approval by Kalkine Media of any of the products, services, or opinions of the organization or individual. The user is apprised that Kalkine Media bears no responsibility for the accuracy, legality, or content of Reuters, any external sites, or for that of subsequent links. The user is requested to contact Reuters directly for answers to questions regarding the content. Please note that Kalkine Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

Featured Articles

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK