Vol. 5 Num 558 Wed. December 21, 2005  

Tokyo exchange chief, executives resign over system failures

The president and other executives at Japan's largest bourse have resigned following two massive computer system failures, including one that caused massive losses at a major brokerage house, the Tokyo Stock Exchange said Tuesday.

Chairman Taizo Nishimuro will double as the Tokyo exchange's president effective Wednesday, after the departure of President Takuo Tsurushima, the bourse said in a statement. Executives Sadao Yoshino and Tomio Amano also stepped down.

Board directors will also take a 10 percent pay cut for three months starting in January, the exchange said.

Earlier this month, the Tokyo Stock Exchange failed to stop an erroneous order placed by Mizuho Securities Co that cost the brokerage about 40 billion yen (US$333 million; euro 278 million).

After initially denying there was a problem with the trading system, the exchange later said a malfunction of its own system prevented Mizuho Securities from quickly cancelling the botched trade.

That may leave open the possibility of the bourse shouldering part of Mizuho Securities' loss.

That incident came a month after trading was suspended for all but the last 90 minutes of the trading session due to a glitch in the bourse's transactions system.

Last week, Japan's financial watchdog agency ordered the TSE to improve its operations after the botched trade involving Mizuho.

The TSE has until January 31 to report on the measures to ensure there are no further trading problems, and to determine who was responsible for the mishap, the Financial Services Agency said.