KEY POINTS:
Stockbrokers are publicly supportive of the strategic direction of market operator NZX after documents complaining of poor-quality work by NZX were posted on the internet.
Two letters from the Securities Industry Association (SIA), the industry body for stockbrokers, and a reply from NZX chief executive Mark Weldon have been posted on a blog.
The issues they deal with are a technology project for clearing and settlement systems and the industry response to an NZX consultation paper on rules and procedures for the exchange.
The SIA letter on rule changes said there were errors, inconsistencies and omissions in the NZX's consultation paper. It was "at times incomprehensible". The process was rushed and NZX was extending its powers.
Weldon acknowledged the consultation paper released in December was substandard and outlined a plan overseen by a member of the NZX's legal and regulatory team to improve the process.
The SIA said yesterday the release of SIA and NZX correspondence was likely to be a breach of legal confidentiality and of NZX rules. The SIA has asked its members to investigate the source of the leak.
The association said its members supported the strategic initiatives being undertaken by NZX.
The clearing and settlement infrastructure proposals were complex and involved many parties, some with conflicting and competing interests.
The SIA said its letter dealt with execution issues and the preference of some of its members to review the timing of changes.
"NZX has already acknowledged areas for improvement and is working towards implementation of appropriate or alternative solutions, as well as entering into discussions with NZX firms on the question of timing of change," an SIA statement said.
The statement listed 10 firms supporting the NZX initiative for change.
The SIA letter on the issue of the back office systems called on the NZX to take a leadership role "assumed at this point" by the SIA.
- NZPA
