ASX to Raise $150M Capital, Reset Accelerate Program Following ASIC Report

• ASX to accumulate an additional $150 million capital by June 2027
• Accelerate Program undergoes strategic reset with expanded scope
• Clearing and settlement facility boards to be fully independent
• Dividend payout ratio lowered to fund capital requirements
• Medium-term return on equity target revised downward

Context and Catalyst

In a decisive response to an interim report from the Australian Securities and Investments Commission (ASIC) Inquiry Panel, ASX Limited has committed to a comprehensive package of strategic actions aimed at addressing critical findings related to its market infrastructure operations. The Panel’s report, released on 15 December 2025, highlighted areas requiring urgent attention, particularly around operational risk management, governance, and resilience.

ASX’s commitment signals a willingness to embrace significant change, including a reset of its Accelerate Program, a multi-year transformation initiative originally launched earlier this year to improve operational risk and culture. The reset will expand the program’s scope to incorporate the Panel’s recommendations, with a deadline for agreement on the revised scope set for 1 July 2026.

Governance Reforms and Capital Requirements

One of the most notable governance reforms is ASX’s pledge to ensure that the boards of its clearing and settlement facilities, ASX Clear, ASX Settlement, ASX Clear (Futures), and Austraclear, will be composed exclusively of independent, non-ASX Limited directors. This move aims to strengthen oversight and reduce conflicts of interest, a key concern raised by the ASIC Inquiry.

Financially, ASIC has imposed an additional $150 million capital charge on ASX, reflecting an elevated risk profile identified in the report. ASX must accumulate this capital above its net tangible asset value by 30 June 2027, holding it until specific milestones in the revised Accelerate Program are met and approved by ASIC. To support this, ASX has adjusted its dividend policy, lowering the payout ratio to between 75% and 85% of underlying net profit after tax, with expectations to remain at the lower end for at least the next three dividends. Additionally, a discounted dividend reinvestment plan will be offered during this period.

Financial Guidance and Strategic Outlook

ASX’s medium-term return on equity (ROE) target has been revised downward to a range of 12.5% to 14.0%, reflecting the impact of the increased capital requirements. Despite these changes, the company maintains its guidance for FY26 total expense growth and capital expenditure, with expense growth expected between 14% and 19% compared to FY25, including costs related to the ASIC Inquiry response.

Capital expenditure remains focused on technology modernization, with FY26 CAPEX guidance between $170 million and $180 million and FY27 guidance between $160 million and $180 million. ASX emphasizes that these investments are crucial for building a resilient and future-ready market infrastructure, though delivery risks inherent to such programs remain.

Leadership and Market Confidence

ASX Chair David Clarke acknowledged the challenging nature of the report but underscored the importance of the strategic package in resetting the company’s trajectory. CEO Helen Lofthouse echoed this sentiment, emphasizing the need for stronger leadership and transformation at all levels to meet the expectations set by the ASIC Inquiry.

The company’s transparent approach and commitment to disciplined execution aim to rebuild trust with regulators, investors, and market participants. The final report from the ASIC Inquiry Panel is expected by 31 March 2026, which will provide further clarity on ASX’s progress and ongoing regulatory expectations.

Bottom Line?

ASX’s strategic reset and capital commitments mark a pivotal step toward restoring confidence, but execution risks and regulatory scrutiny remain closely watched.

Questions in the middle?

• How will the revised Accelerate Program milestones be defined and measured?
• What impact will the increased capital charge have on ASX’s long-term profitability and shareholder returns?
• How quickly will the transition to fully independent clearing and settlement boards be completed?