NZX delivered a trading tech overhaul in 2017
- 19 February, 2018 07:28
NZX delivered more robust and secure systems in 2017 through a quartet of projects.
The New Zealand stock exchange delivered four major technology projects in 2017, including a life-cycle upgrade to its core trading and settlement systems.
The exchange company's annual report, released today, said maintaining a trusted and reliable market infrastructure will continue as a key priority.
Information technology costs have increased steadily over the last couple of financial years, the NZX's annual report reveals, rising from $6.2 million in 2015 to $7.8 million last year.
In addition to the clearing and settlement upgrade, NZX moved its New Zealand-based capital market participants to what it described as "a modern and robust" telecommunications infrastructure, implemented changes to the way administrative trading halts are applied, and upgraded its website NZX.com.
"These initiatives are already contributing to the improved efficiency and resilience of our business and the wider market," it told investors.
NZX said it considered there was a risk that the security of its information technology systems could be compromised.
"To manage such a risk, NZX’s systems have been moved to a cloud-based server with access, security and backups managed by an independent service provider," it said.
The company's IT costs include software licence fees, hardware support and maintenance fees, telecommunications and data network costs, and IT services provided by third parties.
"The increase in costs came from one-off costs relating to IT infrastructure, remediation, migration and consolidation projects completed in 2017, which will deliver cost savings in future years, and NZX Wealth Technology data hosting costs relating to new client projects," the exchange said.
NZX Wealth Technologies is wholly owned wealth management business that delivers online platforms to help investment advisers and providers to manage, trade and administer their clients' assets.
Looking ahead, NZX sees business opportunities in its data.
"Data is an area of increasing opportunity as we take raw data and develop insights that match customer demand to help grow our core markets business," it said.
"We have a unique opportunity to expand our dairy data offering and are scoping requirements to create a dairy information service to support our derivatives market.
"In the second quarter we will partner with Bloomberg to hold our first joint marketing events to drive growth and extend our reach into Asia. We are also exploring opportunities with other global data vendors."
Despite a dearth of new listing activity during the year, operating earnings of $29 million were at the higher end of guidance, 31.3 per cent up on 2016 on a like-for-like basis.
Revenues increased 1.1 per cent to reach $75.3 million and net profit after tax was $14.8 million, up 61.6 per cent on 2016.