Releasing its 2025 review of the ASX’s clearing and settlement (CS) operations, the RBA said the exchange had “considerable work to do” to meet its standards as a provider of critical national market infrastructure.
The findings follow a series of shortcomings in the ASX’s risk management, most notably a batch settlement failure in the CHESS system in December 2024 that disrupted trade processing.
The central bank’s assessment found that while the CS facilities met or broadly met many of the financial stability standards, several critical areas were rated as only “partly observed”. These included governance, credit risk, settlement finality and operational risk.
ASX Clear and ASX Settlement were again rated “not observed” on operational risk – repeating a failing grade first applied in March 2025.
RBA assistant governor (financial system) Brad Jones said the ASX was not currently meeting the expectations of regulators.
“ASX is not currently meeting the regulators’ expectations for an operator of critical national infrastructure. Resilient and secure CS facilities are crucial to the stability of the Australian financial system,” he said.
“This assessment highlights that ASX still has more work to do to in strengthening its governance, risk culture and frameworks for managing operational and financial risk. We are expecting meaningful progress over the coming year and will consider further regulatory responses if necessary.”
The RBA has set out a list of recommendations, including requiring the ASX to:
– Close gaps in its risk appetite statement and strategy.
– Properly resource its risk transformation program and provide regular progress reporting.
– Review business continuity and contingency arrangements.
– Improve data and reporting controls for its financial risk models.
The central bank emphasised that the exchange must also accelerate the overhaul of its operational and financial risk systems while hitting key milestones on major technology projects.
The work, it said, will require “appropriate resourcing” and will be closely monitored over the next year.
The assessment is the latest setback for the ASX as it struggles to modernise its infrastructure following the collapse of its long-running CHESS replacement project. The exchange is now under heightened scrutiny from regulators, with both the RBA and ASIC coordinating supervision of its clearing and settlement facilities.
The RBA conducts annual assessments of ASX’s four CS facilities, including two central counterparties and two securities settlement entities, with a focus on financial stability and the reduction of systemic risk.
