Longest trading disruption in SGX history deals huge blow to bourse’s reputation, say analysts

Trading will be extended to 5pm today to compensate.

The latest trading halt by the Singapore Exchange is a huge setback for the bourse’s reputation, especially as it aspires to be a multi-asset exchange.

According to a report by OCBC, the yesterday’s closure was a technology issue affecting its trade confirmation processes.

“In 4Q14, SGX also experienced two trading disruptions in Nov and Dec, leading to a reprimand from the Monetary Authority of Singapore (MAS). Meanwhile, MAS said that it is monitoring this current situation closely,” OCBC said.

Additionally, the disruption also affected the trading of Noble’s rights, and the company announced that trading will be extended to 5pm today.

“Based on the previous incident, it took the MAS about 6-7 months before it issued the reprimand on SGX, and it could take about the same amount of time before the MAS issues its official statement on the current incident,” OCBC noted.

While the financial impact is likely to be minimal, OCBC added that internal steps need to be taken to ensure that disruptions will not happen again.