RBA Flags ASX Clearing Facilities Still Falling Short on Governance and Risk
Key points
- The RBA's September 2026 annual assessment rated ASX's CS facilities as 'partly observed' on Governance, Framework for Comprehensive Management of Risks, Credit Risk, and Operational Risk standards.
- ASX Clear and ASX Settlement were upgraded from 'not observed' to 'partly observed' on the Operational Risk Standard, specifically because of improved CHESS resourcing and contingency arrangements following the December 2024 batch settlement incident.
- The RBA explicitly stated that the operational risk upgrade does not signal a broader improvement in ASX's management of operational risk.
- ASX has launched a Transformation Portfolio to address longstanding shortfalls in governance, capability, culture, and risk management, which the RBA described as a potential pathway to meeting expected standards if delivered effectively.
- RBA Assistant Governor Brad Jones warned that ASX must demonstrate it can execute the transformation programme without compromising the safe and reliable operation of its critical market infrastructure.
Australia’s Reserve Bank has published its annual assessment of ASX’s four clearing and settlement (CS) facilities, finding persistent shortfalls across governance, risk management, credit risk, and operational risk standards. Under the Financial Stability Standards (FSS) framework, the RBA rated one or more of the facilities as only ‘partly observed’ against those four standards, a step below the ‘broadly observed’ or ‘observed’ ratings recorded across many other individual requirements.
The most operationally notable movement is an upgrade to ASX Clear and ASX Settlement on the Operational Risk Standard, lifted from ‘not observed’ to ‘partly observed’ following improvements to CHESS resourcing and contingency arrangements made in response to a batch settlement incident in December 2024. The RBA was explicit that this upgrade reflects targeted CHESS improvements rather than any broader positive view of ASX’s operational risk management culture.
ASX has established a Transformation Portfolio aimed at addressing what the RBA describes as longstanding deficiencies in governance, capability, culture, and risk management. RBA Assistant Governor Brad Jones characterised the programme as offering a potential pathway to compliance, while warning that the transition must not compromise the reliable operation of infrastructure that is critical to Australia’s financial system. The implication is that ASX remains under close supervisory scrutiny, with the RBA watching whether the transformation delivers measurable outcomes rather than organisational repositioning alone.
The Australian Securities and Investments Commission (ASIC) holds complementary supervisory responsibilities over the same facilities, and the two regulators coordinate their oversight. Market participants relying on ASX’s CS infrastructure should note that the RBA’s current ratings leave ASX in a formally sub-standard position on several fronts, with improvement contingent on a multi-year organisational programme whose delivery remains unproven.