The Reserve Bank of Australia (RBA) has released its 2025 assessment of the ASX Clearing and Settlement (CS) Facilities, evaluating their performance against the RBA’s Financial Stability Standards.
According to the RBA, ASX faces significant challenges in meeting expectations for operators of critical market infrastructure. The assessment points to recent issues in risk management, notably a batch settlement incident involving CHESS in December 2024. The RBA states that ASX must implement foundational changes to governance, culture, and risk management processes. Additionally, the RBA calls for accelerated improvements in operational and financial risk management as well as timely completion of major technology projects. The central bank indicated it will closely monitor ASX’s progress over the next year.
The report notes that while many individual standards were rated as “observed” or “broadly observed,” some requirements were only “partly observed.” These include standards related to comprehensive risk management frameworks, governance, credit risk, settlement finality, and operational risk. ASX Clear and ASX Settlement continue to be rated as “not observed” on the Operational Risk Standard following an out-of-cycle review in March 2025.
The RBA has issued several recommendations for ASX:
– Obtain assurance that gaps in its risk appetite statement and strategy are addressed.
– Ensure adequate resourcing for its risk transformation plan and provide regular reporting.
– Review business continuity and contingency arrangements across CS facilities.
– Improve data and reporting controls for financial risk models and address identified issues.
RBA Assistant Governor (Financial System) Brad Jones said: “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.
“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 is responsible for supervising Australian-licensed CS facilities with a focus on financial stability and reducing systemic risk. Systemically important CS facilities undergo regular assessments against established Financial Stability Standards. The annual reviews cover four key facilities operated by ASX: two central counterparties—ASX Clear Pty Limited and ASX Clear (Futures) Pty Limited—and two securities settlement facilities—ASX Settlement Pty Limited and Austraclear Limited.
The Australian Securities & Investments Commission (ASIC) also holds supervisory responsibilities for CS facilities, working alongside the RBA.
For more information on how the Reserve Bank assesses clearing and settlement facility licensees, see The Reserve Bank’s Approach to Supervising and Assessing Clearing and Settlement Facility Licensees.
