ASX chair says exchange has reached a turning point after outages

what happened

ASX chair David Clarke told shareholders at the annual meeting on Thursday that the Australian Securities Exchange has reached an important turning point in resolving its regulatory problems, according to Reuters. The exchange has suffered repeated trading halts and settlement delays over the past three years after a faulty technology upgrade. The Australian Securities and Investments Commission required it to set aside an additional A$150 million ($105 million) of capital and rebuild its infrastructure.

To comply with the order issued last December, ASX lowered its dividend payout from 85% to 75% of underlying net profit. Clarke said the ratio would stay at that level for at least the interim dividend period this financial year, despite pressure from some investors who wanted higher payouts since the exchange was ahead of schedule on capital. New chief executive Anthony Attia said operating expenses would grow 18% to 21% this year, with capital expenditure of A$180 million to A$200 million, both forecasts raised earlier in the year to fund the technology overhaul. Shares were up 0.3% on Thursday while the S&P/ASX 200 fell 0.35%.

why it matters

The capital and cost picture matters for investors: the exchange is directing more money to infrastructure and balance-sheet strength while keeping its payout below previous levels. The technology rebuild is now a key driver of its earnings outlook, and the regulator's oversight still shapes its decisions.

market impact

ASX and Australian equities: higher spending and capital needs, with payouts held at 75% of profit

tags

instruments