NZX and Financial Markets Authority team up

NZX HQ Wellington
Matt Duncan

NZX HQ Wellington

The NZX and the Financial Markets Authority have agreed measures to improve their working relationship in the interests of investors and market development.

Chief executives Tim Bennett and Rob Everett signed a memorandum of understanding today that aims to boost communication and co-operation beyond their statutory roles, which require the FMA to review the NZX's regulation of the stock exchange each year.

A market source, who asked not to be named, said the MoU showed a recognition of the need to improve.

"The NZX has suffered over time from significant staff turnover and capability gaps – and probably a willingness gap," he said.

In last year's review the FMA said the NZX should improve its handling of conflicts of interest and enforcement of market rules, to enhance the public's confidence in the NZX's ability to regulate the market.  

In a statement, they said the MoU "demonstrates the ongoing commitment from both the FMA and NZX to ensure that effective frontline regulation of New Zealand's capital markets remains a priority for both organisations.

Particular areas of focus will be:

(a) live market issues

(b) continuous disclosure (investigations and waiver/rulings)

(c) insider trading and market manipulation surveillance and investigation

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(d) investigations and complaints concerning market particants [sharebroking firms]

(e) market rules approval

(f) review of offer documents."

The agreement requires the NZX to provide the FMA with copies of board minutes and internal reports relevant to market supervision every quarter.

It also creates two joint committees overseeing the way the organisations communicate and share information.

 - Stuff

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