Toronto exchange blames member firms for crashesgreenspun.com : LUSENET : TB2K spinoff uncensored : One Thread
Friday March 10, 4:49 pm Eastern Time
Toronto Exchange blames crashes on some member firms
By Lydia Zajc
TORONTO, March 10 (Reuters) - The Toronto Stock Exchange's chief executive said on Friday that trading outages on Canada's biggest bourse, which cut two-and-a-half hours off Tuesday's session and enraged market players, stemmed from members using outdated technology.
In her first round of media interviews since the crashes, TSE Chief Executive Barbara Stymiest pointed out that the exchange has updated its equipment since introducing the world's first computerized trading system in 1977 -- unlike all of its equity dealers.
``We have a very state-of the art engine running on state-of-the-art equipment and it's how the orders are getting in,'' Stymiest said. ``Some members are using old technology.''
On Tuesday the exchange was forced to delay the session start by an hour after discovering a hardware gremlin, which meant reentering trade orders. Then a problem with the same hardware popped up again in the afternoon, forcing investors to sit on the sidelines for an hour and a half.
The problems left market players grumbling that the recent series of breakdowns make the exchange -- No. 14 in the world in terms of value traded -- unworthy of ``world-class'' status, despite the burgeoning trading volume that has flowed through its systems in the last few months.
Many traders hope that the glitches might dry up once the exchange begins channeling all trades through one gateway, down from three. That's scheduled to start in September.
``Some of our members are still using ... the old fragile code that's existed for 20-odd years,'' which should change in September, Stymiest said.
``We're in ongoing dialogue with all of our members on a regular basis with how their orders come into the exchange,'' Stymiest added. ``(That's) part of some of the very many steps that we're taking to ensure that we continue to raise the bar higher and have as high availability as possible.''
Tuesday's woes were -- at least -- the third system problem to crop up this year.
Unprecedented volumes at the opening bell wreaked havoc on the exchange's reporting systems on February 18. And on February 21, the TSE had to halt trading two minutes early when orders overran its order management system.
Investor infatuation with penny stocks was cited as one reason for heavy volumes, which have soared in the last six months. In January, the number of transactions more than doubled to 2.83 million from 1.28 million in August 1999.
``We've made huge investments in technology and if we hadn't we wouldn't be able to process the volumes that we are processing, 99.98 percent of the time,'' Stymiest said.
Stymiest, who spoke to a gathering at an international mining conference held in Toronto before talking to reporters, told the audience that problems were likely to crop up.
``Given both the unprecedented volumes as well as the number and size of technology initiatives underway at the TSE, it is unfortunate but not completely surprising that there's been the occasional glitch,'' Stymiest said.
Stymiest compared the TSE's recent woes to the low prices of mining stocks, sparking laughter from the 300-odd audience. ``You are not the ones who feel under appreciated these days. It has been quite a week at TSE,'' she deadpanned.
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But it's NOT Y2K--oh, no, it's not y2k!
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