SGX working on solving clearing and settlement issues

Sep 1, 2010

Singapore Exchange may be improving its technology to increase trading speeds and liquidity, but it is aware that clearing and settlement remains an issue.

Singapore Exchange (SGX) will go live with new technology to boost trading speeds in the coming year, but some market participants are concerned that the exchange’s clearing and settlement fees remain high and are complex to execute in a pan-Asian context.

It’s a good thing that SGX is improving the front-end trading platform, but that doesn’t address the issue of clearing and settlement, says John Fildes, Singapore-based director of strategic development for Asia at electronic trading and market-making firm Getco.

He was responding to a presentation given by SGX chief information officer Bob Caisley at the Trading Architecture conference in Hong Kong yesterday.

The concern is that back-office developments need to keep up with faster trading solutions, adds Fildes. He cites the fact that SGX’s cash clearing charges are the highest of all the developed Asian markets, and Chi-East -- a joint-venture dark pool between Chi-X and SGX -- has a very complex process for clearing and settlement.

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