SGX sets up panel to recommend ways to improve market's operational resilience

SINGAPORE Exchange (SGX) said on Tuesday it has formed a Securities Industry Working Group (IWG), in consultation with the Monetary Authority of Singapore (MAS).

This group will assess and make recommendations on SGX and industry participants' processes to improve the Singapore securities market's operational resilience.

In making its recommendations, the group will take into consideration findings from feedback garnered from members and participants as well as SGX's own investigations following the July 14 market disruption.

What happened that day was reportedly a technical glitch which prompted SGX to suspend one of its platforms. The securities market had been open for just 21/2 hours when it was shut down at 11.38am.

SGX said the move was due to duplicate trade-confirmation messages being generated, although no duplicate trades were executed. Trading was supposed to resume at 2pm, but this was later pushed back to 4pm to allow for member reconciliation to be completed. When the exchange could not meet that second target, it shut the market for the day.

SGX on Tuesday said the group is expected to complete its assessment and submit its recommendations to the MAS by Q1 2017.

The group comprises a broad base of stakeholders and is chaired by Ho Tian Yee, a board member of DBS Group Holdings and chairman of Fullerton Fund Management.

In addition to SGX management, the other 12 members include local and international members of SGX's securities market, representatives from the investment community, independent specialists and software vendors.

The areas that will be reviewed, assessed and given recommendations on include:

* appropriate provision of back-up systems and processes;

* the ability to re-connect SGX and its market participants following a disruption;

* protocols and processes between SGX and its members to resume trading promptly in the event of a disruption;

* communication and maintenance of these established protocols and processes; and

* business continuity planning and industry-wide exercises to familiarise and test SGX and its market participants' readiness to respond to market disruptions.

Mr Ho said: "Markets are becoming more complex with increasing dependency among participants, and the attendant risks of multiple points of disruption are ever present. I look forward to working with the IWG to contribute towards strengthening the industry's operational resilience for the stakeholders we represent and serve."