ASX Buys Stake in Austraclear

The Australian Stock Exchange Limited (ASX) today announced a further stage in the development of its debt market strategy having reached agreement to acquire a 13 per cent interest in Austraclear Limited, an unlisted public company. Austraclear is a central securities depository providing clearing and settlement facilities to the Australian fixed interest and money markets. ASX will be entitled to appoint a director to the Board of Austraclear once the acquisition of the shares is completed. This stake will put ASX in a position to contribute to the strategic direction of Austraclear. "The acquisition is clear evidence of ASX's commitment to improving the market infrastructure for interest rate and debt products," said ASX Managing Director, Mr Richard Humphry. "ASX has been encouraged by investors, borrowers and brokers to increase its role in the interest rate market. The enthusiastic response to the recent listings of fixed interest securities by wholesale and retail borrowers illustrates the growing depth of this market," he added In response to retail investor demand, ASX will also offer improved trading, settlement and information dissemination for listed interest rate securities. For example ASX is upgrading its electronic trading system (SEATS) to offer specialised trading screens for listed interest rate products. These screens will have a new facility to reflect the prices of those securities in yield, thereby enabling investors to compare returns on listed interest rate products. Through these initiatives ASX will provide retail investors with easy access (via their broker) to purchase interest rate securities issued by the Commonwealth and State governments, State instrumentalities and major offshore and domestic corporations," Mr Humphry said. Settlement of these trades will take place in CHESS, the ASX's electronic settlement system. Investors in these securities will therefore have access to an active market that will offer the same trading and settlement facilities that the ASX provides for shares.