Published: Wednesday March 31, 2010 MYT 9:44:00 AM
Australia approves in principle second stock exchange
CANBERRA, Australia (AP): An Australian subsidiary of Chi-X Global Inc. has been given in-principle approval to open a second stock exchange in Australia and break a monopoly that has existed since 1987, a minister said on Wednesday.
Financial Services Minister Chris Bowen said Australia needed to join the United States, Canada, Europe and the United Kingdom in opening its share market to competition in order to develop into a financial services hub in the Asia-Pacific region.
Competition will also mean lower fees for 6 million Australians who directly own shares as well as those who invest in shares through pension funds, he said.
"If Australia seriously wants to be considered as a financial center, if we seriously want to be regarded as a global financial services hub, then the days of having a monopoly in our capital and financial markets need to come to an end," Bowen told reporters.
Australia's market regulator, the Australian Securities and Investments Commission, will take over supervision of the Australian market later this year from monopoly holder Australian Securities Exchange Ltd., known as ASX Ltd., while Chi-X Australia Pty. Ltd. settles in, he said.
Chi-X Australia is a wholly owned Australia-incorporated subsidiary of Chi-X Global Inc., which is owned by global broker Instinet, itself a subsidiary of Japanese broking giant Nomura Holdings. Chi-X Global operates markets in Europe and Canada.
ASX stock fell 1.71 percent to an eight-week low on 34.43 Australian dollars ($31.69) in early trading after the government announcement.