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| ASX Settlement | |
|---|---|
| Name | ASX Settlement |
| Type | Subsidiary |
| Industry | Financial market infrastructure |
| Founded | 1998 |
| Headquarters | Sydney, New South Wales, Australia |
| Area served | Australia |
| Parent | Australian Securities Exchange |
ASX Settlement
ASX Settlement is the central securities depository and settlement system operating within the Australian Securities Exchange group. It provides post-trade services that enable transfer and custody of Australian dollar-denominated equities, exchange-traded products and other financial instruments for market participants including brokers, custodians and central counterparties. ASX Settlement interconnects with regional and global institutions to support trading linked to entities such as Commonwealth Bank of Australia, Westpac, National Australia Bank, ANZ, and international players like J.P. Morgan, Goldman Sachs, and Citigroup.
ASX Settlement operates as a central securities depository (CSD) in the Australian financial market, facilitating electronic holding and transfer of securities issued by corporations such as BHP Group, Rio Tinto, Woolworths Group, and Telstra Corporation. It underpins market activity on the Australian Securities Exchange and interacts with infrastructure like the Reserve Bank of Australia's payment systems, clearing houses including ASX Clear and international counterparts such as Depository Trust & Clearing Corporation and Euroclear. Participants include institutional custodians like BNP Paribas Securities Services and State Street Corporation as well as retail brokers associated with firms such as CommSec and NAB Trade.
ASX Settlement originated from reforms following consolidation of Australian market infrastructures in the late 20th century, paralleling developments involving entities like Sydney Futures Exchange and regulatory changes influenced by acts such as the Corporations Act 2001 (Australia). Its formation followed industry transitions that included demutualization events associated with organisations like ASX Limited and technological modernization trends witnessed in markets like London Stock Exchange and New York Stock Exchange. Over time ASX Settlement evolved through projects comparable to initiatives by CHESS replacement program participants and international modernization efforts seen at Deutsche Börse and SIX Swiss Exchange.
ASX Settlement offers core services: immobilisation and dematerialisation of securities for issuers such as Qantas Airways, registration coordination with registrars like Link Group, corporate action processing for companies including Macquarie Group, and settlement finality in coordination with the Reserve Bank of Australia. It provides delivery-versus-payment (DVP) mechanisms used by participants including Perpetual Limited and AMP Limited, and supports sponsored and sponsored-sponsored accounts for global custodians such as Julius Baer and HSBC. Cross-border linkages and interfaces accommodate settlement flows involving markets like Singapore Exchange and Tokyo Stock Exchange.
Members of ASX Settlement include a range of licensed intermediaries: stockbrokers registered with bodies such as the Australian Securities and Investments Commission, custodian banks like BNP Paribas, Citigroup, and State Street, and settlement utilities interacting with providers such as SWIFT and CLS Bank International. Issuers including Fortescue Metals Group and trustees for managed investment schemes use the system via transfer agents like Computershare. Central counterparties such as LCH Ltd and indirect participants including pension funds like AustralianSuper access services through sponsoring intermediaries.
The clearing relationship with ASX Clear and linkage to payment finality via the Reserve Bank Information and Transfer System supports gross and net settlement cycles. ASX Settlement implements a T+2 settlement cycle comparable to regimes in European Union markets following standards applied by institutions such as IOSCO and Bank for International Settlements. Processes encompass trade affirmation, allocation, delivery-versus-payment instructions, corporate action entitlements and registry updates for issuers like Scentre Group and COLES Group.
Risk controls include participant admission standards similar to practices at Federal Reserve-linked systems, collateral and margin arrangements coordinated with ASX Clear and contingency procedures aligned with recommendations from Financial Stability Board and Australian Prudential Regulation Authority. Operational safeguards include disaster recovery plans modelled on frameworks used by NASDAQ and Deutsche Börse and participant default arrangements that reference global protocols seen at Clearing House Interbank Payments System.
ASX Settlement runs on secure, high-availability platforms integrating messaging standards such as ISO 20022 and connectivity protocols used by SWIFT. Technology upgrades have been benchmarked against projects at London Stock Exchange Group and CME Group, with data centers in Sydney and resilience measures comparable to those applied by IBM and Microsoft Azure cloud services. Ongoing modernization includes initiatives to replace legacy systems, mirroring transformation efforts at CHESS replacement program peers and international operators like Euroclear.
Category:Financial market infrastructure of Australia