Key Highlights

  • ASX Clear and ASX Settlement were upgraded from “not observed” to “partly observed” on Operational Risk.
  • The upgrade reflects strengthened CHESS resourcing and contingency arrangements after the December 2024 batch settlement incident.
  • The RBA stated that the upgrades do not indicate an assessment of broader improvement in ASX’s management of operational risk.

Two ASX facilities moved up a notch on operational risk in the Reserve Bank's September assessment, yet the central bank went out of its way to say the change did not signal a broader improvement in how ASX manages that risk.

Rating upgrades usually read as good news. The Reserve Bank of Australia's (RBA) 23 September 2026 assessment of ASX's clearing and settlement facilities contained one, but it came with a pointed caveat attached.

ASX Clear and ASX Settlement were upgraded from "not observed" to "partly observed" against the Operational Risk standard. In the same release, the RBA said those upgrades "do not indicate an assessment of broader improvement in ASX's management of operational risk."

The apparent contradiction, an upgrade that is not an improvement, dissolves once the reasons for the change are set out.

Behind the move from "not observed"

The RBA linked the upgrades to two specific developments: strengthened CHESS resourcing and strengthened contingency arrangements. Both followed the December 2024 batch settlement incident.

That context is important. The upgrades reflect targeted responses to an identified problem. More resources were committed to CHESS, and contingency arrangements were strengthened so that the system is better prepared if something goes wrong. Those steps were enough, in the RBA's judgement, to lift the two facilities out of the "not observed" category on that standard.

What they were not, according to the RBA, was evidence of a wider change in how ASX manages operational risk across its business. The upgrade recognises specific remediation; it does not certify a broader transformation.

The distinction between the two is common sense once spelled out. Adding resources and contingency to one critical system after a known incident addresses that system and that kind of failure. Broader operational risk management concerns how an organisation identifies, prevents and responds to problems across all of its operations, including ones that have not yet occurred.

Reading the caveat closely

The RBA's wording is precise. The upgrades "do not indicate an assessment of broader improvement in ASX's management of operational risk." The sentence does not say ASX's operational risk management has deteriorated, nor that it has stayed the same. It says the upgrade should not be taken as an assessment that it has broadly improved.

One effect of the sentence is clear. Without it, readers could reasonably interpret a move from "not observed" to "partly observed" as a sign that ASX's operational risk problems were being resolved. The caveat closes off that interpretation and keeps attention on the narrower basis for the change.

It also fits the overall tone of the assessment. Brad Jones, Assistant Governor (Financial System), said: "ASX is still not meeting the RBA's expectations in several important areas."

Where the scorecard still falls short

The assessment covered four facilities against the RBA's Financial Stability Standards: ASX Clear, ASX Clear (Futures), ASX Settlement and Austraclear. Many standards were rated "observed" or "broadly observed". But one or more facilities remained "partly observed" on four standards:

  • Governance;
  • Framework for Comprehensive Management of Risks;
  • Credit Risk; and
  • Operational Risk.

Even after the upgrade, then, operational risk remains in the "partly observed" group. The two upgraded facilities have moved up a step on that standard, but they have not reached "broadly observed" or "observed".

The assessment uses four labels that appear in the RBA's release: "observed", "broadly observed", "partly observed" and "not observed". Read in that order, the September change for ASX Clear and ASX Settlement was a single step, from the last label to the one above it. Two steps would still separate them from "observed" on Operational Risk.

It is also worth noting the scope of the change. The upgrade applied to two of the four facilities assessed, ASX Clear and ASX Settlement. The release, as summarised here, does not describe a matching operational risk upgrade for ASX Clear (Futures) or Austraclear. The improvement was specific not only in its causes but also in the facilities it covered.

The RBA's Payments System Board offered a similar picture after its meeting on 27 August 2026. It said "significant challenges related to ASX governance, culture and risk management require sustained focus", while also noting progress on CHESS resilience and the safe delivery of CHESS Replacement Release 1. Progress on CHESS resilience is consistent with the targeted upgrades; the broader concerns about governance, culture and risk management are consistent with the caveat.

The real test lies ahead

If the upgrade is not the measure of broader improvement, what is? The RBA points to the Transformation Portfolio. If delivered effectively, it "provides ASX with a pathway to meet the standard expected of an operator of critical market infrastructure."

Jones framed the challenge as delivering that transformation "without compromising the safe and reliable operation of its critical infrastructure." That is itself an operational risk question. Large-scale change to systems and processes has to be carried out while the existing infrastructure keeps running reliably.

Operational resilience is a theme across the RBA's recent publications. Its October 2026 Financial Stability Review, released on 1 October, said the system has "a good degree of resilience" but that global and operational vulnerabilities are growing. It listed disruption at critical service providers among the threats, and urged institutions to keep building resilience and strengthen crisis preparedness. The minutes of the Monetary Policy Board's 28–29 September meeting also noted that operational risks, including outages at common service providers, were growing.

Against that backdrop, the RBA's care in describing the ASX upgrade is understandable. An operator of critical market infrastructure is held to a high standard on operational risk, and the RBA has signalled that targeted fixes alone do not meet it.

The bottom line

ASX Clear and ASX Settlement were upgraded from "not observed" to "partly observed" on Operational Risk in the RBA's 23 September 2026 assessment, reflecting strengthened CHESS resourcing and contingency arrangements after the December 2024 batch settlement incident. The RBA stated that these upgrades "do not indicate an assessment of broader improvement in ASX's management of operational risk." Operational risk remains among four standards where at least one ASX facility is only "partly observed", and the RBA has tied any path to the expected standard to effective delivery of the Transformation Portfolio.

An upgraded assessment rating should be reported separately from the outstanding requirements and any limitations the RBA identified.