IOSCO Conference 2001 address: Market demutualisation and privatisation – The Australian experience
ASIC Deputy Chair, Jillian Segal's address to the IOSCO conference, Stockholm, Sweden, 28 June 2001.
When trading began in shares in ASX Limited on 14 October 1998, history of a sort was made. Other market operators – such as the OM market – operated as listed, for-profit entities, but this was the first time as far as I am aware that exchange shares traded on a market operated by the exchange. Now, in 2001, Australia has four exchange markets: The Australian Stock Exchange (ASX); the Sydney Futures Exchange (SFE); and two smaller regional equity markets. They all have one thing in common – none has a mutual structure. For Australia, at least, the era of not-for-profit, mutual ownership of financial markets has passed.
My purpose today is to share with you some of the experiences we have had in the transition to this new world: to touch on some of the issues we have had to deal with as the market regulator; and to highlight what we are now focussing on. I will also attempt to discuss some of the lessons we have learnt and indicate where work that for us began as 'demutualisation work' is now leading. Most of my remarks will be about our experience with ASX. That is because it is Australia's premier capital market, and because ASX first raised the complex set of issues we have been working through. Nevertheless, the ASX experience has close parallels in our other major market, the SFE.
Let me begin, as they say, at the beginning, with the story of the demutualisation process of ASX.