Singapore Exchange's securities market reopens after disruption

Fri Jul 15, 2016 7:43am EDT
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By Aradhana Aravindan and Marius Zaharia

SINGAPORE (Reuters) - Trading in the Singapore securities market resumed on Friday after the fourth major interruption on the exchange in the past two years, piling pressure on CEO Loh Boon Chye as he tries to rejuvenate a bourse facing stiff competition in the region.

The Singapore Exchange Ltd (SGXL.SI: Quote) said securities trading was suspended just before midday on Thursday due to duplicate trade confirmation messages being generated. After having to delay planned resumptions twice, the exchange closed the market for the day.

Singapore's central bank said it took a serious view of the closure and would decide on regulatory action after the bourse had submitted its investigation report.

In a conference call with the media on Friday, Loh said the disruption was caused by a hardware issue, but gave few additional details and declined to say if any individual or department will be held accountable.

"It was triggered by hardware ... and we are focused on reviewing ... any gaps there may be in our recovery process," said Loh, who completed his first year at the bourse on Thursday.

The amount of short selling - by which an investor borrows a security and sells it in the hope that it can buy it back at a lower price - which could have caused losses for investors was "insignificant", he said. The bourse will waive buy-in penalties for short-sellers who were unable to cover their positions on time due to Thursday's market outage.

SGX shares fell 0.6 percent, underperforming the Straits Times Index .STI, which was up 0.6 percent.

The latest interruption adds to challenges faced by Chief Executive Loh, as the SGX battles lackluster securities trading volumes and tries to improve scrutiny on trading activities following a penny stock crash in 2013.   Continued...

A Singapore Exchange logo sits outside their head office in Singapore April 22, 2015.   REUTERS/Edgar Su/File Photo