TCS to design Australian exchange operator’s trading software

Australian exchange operator ASX Ltd said on Monday it has partnered with Tata Consultancy Services (TCS) to create a product-based solution to replace its trading, clearing and settlement system.

The exchange operator said in a statement, “ASX believes the selected product will allow it to provide a reliable, supportive and scalable platform that meets the needs of the Australian market now and into the future.”

The Australian exchange operator noted that it would implement the new platform in two major releases. The clearing service will be provided in the first release. And the second release will include the settlement and sub-registry services.

ASX CEO Helen Lofthouse noted: “This next phase of the project will be a multi-year undertaking and ASX will maintain our investment in the current CHESS platform to ensure it continues to operate efficiently and reliably until the replacement is implemented.”

The ASX also highlighted that the estimated cost of the initial release of the Clearing House Electronic Subregister System (CHESS) project is between A$105 million ($68.33 million) and A$125 million, to be incurred over several years.

The exchange operator added that the CHESS replacement project will move to the next phase of design and implementation, with further stakeholder consultations due to start in the first quarter of 2024.

It’s worth noting that the exchange operator has come under scrutiny in recent times, with Australia passing laws to encourage competition in post-trade settlement and clearing for financial markets since the ASX abandoned a costly rebuild of its CHESS platform last year .

ASX had sought to replace its legacy CHESS software using blockchain-based technology, but abandoned the overhaul last November, citing dysfunctional management, concerns about the product’s complexity and scalability, and difficulty finding experts to support it.

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