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ASX Ltd (ASX:ASX) – the operator of the Australian bourse – has released a fresh update on its controversial CHESS system replacement.
For those playing at home, its CHESS system is basically the internal software that handles trade settlements – buys and sells. It’s outdated, to be sure, evidenced by the simple fact share traders are usually still getting paper envelope statements relating to their share movements to this day.
At the cost of up to A$125 million (and no less than $105M), the ‘Release 1’ (or Phase 1) roll-out of the CHESS replacement is set for delivery at some point in 2026.
A ‘Release 2’ is targeted for 2029 with costs of $270M to $320M expected. Expenditure for this phase “extend[s] beyond the guidance period,” the company noted on Tuesday.
“Our technology modernisation program is part of our strategy to continue to build long term shareholder value,” ASX CEO Helen Lofthouse said.
“The new CHESS system we are implementing is critical market infrastructure and we need to make the appropriate investment to ensure it can provide for the market today and into the future.
“As we progress this important project, we are continuing our investment for the effective and reliable operation of current CHESS.”
Perhaps unsurprisingly, there was no word on the ASIC-led lawsuit ASX is dealing with based around mischaracterisations of the progress of its long-bungled CHESS replacement.
In August this year, the regulator took the bourse operator to Federal Court, charging that ASX’s representations in 2023 the CHESS replacement was “progressing well” were deliberately misleading. (So, you know, fraudulent.)
“We expect the ASX to be a place to list and invest with confidence. When the ASX falls short, it has wide ranging consequences across the market,” ASIC chief Joe Longo said at the time.
This came after the ASX was stung a separate $1M in March of this year.
Also absent from the ASX’s release was any mention of the time it tried to use crypto-logging technology blockchain to replace its CHESS system.
Presumably, that tech utopian idea has now fallen by the wayside.
ASX last traded at $69.15/sh.
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