Productivity Summit: ASX faces threat to market dominance as ASIC mulls CBOE plans
Australia’s $3 trillion stock exchange looks set for a new competitor as the corporate watchdog readies to approve a bid by Cboe to expand operations Down Under.
Cboe Global Markets — which owns the Chicago Board Options Exchange — wants to launch a new platform for local companies to list their shares in direct competition with the Australian Securities Exchange.
The Australian Securities and Investments Commission revealed on Wednesday that it was in the final stages of considering the plan, which would give businesses a new place to raise cash.
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By continuing you agree to our Terms and Privacy Policy.It will add to pressure on the ASX and came on a shocker day for the country’s dominant share market operator.
A “human error” incorrectly added the ticker code for TPG Telecom to an unrelated transaction, and the exchange was forced to unwind trades which had wiped $400m off the company’s value.
That followed ASIC suing the ASX last year over the troubled roll-out of a major technology update.
Treasurer Jim Chalmers talked up the benefits of the plan after talks with regulators and big investors on Wednesday.
“Making our markets more competitive will make our economy more prosperous and productive,” he said.
“If it goes ahead, this will mean more investment in Australian businesses and that means more jobs and opportunities for Australian workers.”
Cboe already handles about 20 per cent of local share trading each day — but the platform so far only includes exchange traded products and companies listed on the ASX.
The company also runs stock exchanges internationally and approval might give Aussie companies the chance to dual-list offshore.
ASIC Chair Joe Longo said improving Australia’s productivity was “important work”.
“Our capital markets are healthy and strong but face intensifying global competition for capital and listings,” he said.
“As superannuation funds grow and investors seek opportunities, our actions will help keep our markets efficient, innovative and attractive, supporting economic growth for all Australians.”
It will not be the only competitive threat for the ASX.
The Canadian Securities Exchange is seeking to buy Australia’s The National Stock Exchange — a lesser-known market that competes with the ASX.
Earlier this week, Toronto Stock Exchange executive Dean McPherson was at Diggers & Dealers in Kalgoorlie seeking to poach local miners for a Canadian-listing.
