Brokerage Trading Settlement System Stress Test Upgraded Again

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Our reporter Zhou Shangyu

On February 13, the Securities Daily reporter learned from securities firms that, to ensure the safe and stable operation of the securities industry, standardize the pressure testing management of trading and settlement systems, identify capacity and performance bottlenecks, enhance system stability assurance capabilities, and protect investors’ legitimate rights and interests, the China Securities Industry Association (hereinafter referred to as “CSSA”) has recently drafted the “Guidelines for Stress Testing of Securities Company Trading and Settlement Systems (Draft for Comments)” (hereinafter referred to as the “Testing Guidelines”) and is seeking opinions from major securities firms. This move aims to clarify the primary responsibilities of securities firms in stress testing, improve the management mechanism, and comprehensively enhance the reliability of industry trading and settlement systems.

Currently, the activity level in the capital market continues to rise, trading volume steadily increases, and some securities firms’ trading systems show performance issues from time to time, which not only affects investors’ trading experience but also poses risks to industry operations. Against this background, the securities industry urgently needs to improve system capacity management capabilities to effectively respond to market fluctuations.

From the content framework, the “Testing Guidelines” consist of six chapters and twenty-eight articles, covering general provisions, basic guarantees and requirements for system stress testing, stress testing procedures and methods, reporting and application of stress test results, self-regulation, and supplementary provisions.

Regarding the guarantee mechanism, the “Testing Guidelines” are based on the scope of trading and settlement systems defined in the Industry Stress Testing Guidelines (hereinafter “Testing Guidelines”) and stipulate that securities firms should establish sound stress testing management mechanisms, improve relevant management systems, clarify personnel responsibilities and divisions of labor, and provide necessary equipment and technical support for stress testing. They should ensure the effective allocation and stable operation of testing environments, data resources, and tool platforms. Additionally, the guidelines standardize the management of testing environments, data, and tools, and require stress testing to be conducted according to scenarios outlined in the testing guidelines to ensure authenticity and effectiveness, thereby comprehensively improving the assessment of system performance and stability.

In terms of trigger mechanisms, the “Testing Guidelines” make differentiated and clear requirements: securities firms using production environments or test environments configured similarly to production must conduct at least one stress test of the trading and settlement system annually; critical information infrastructure units must conduct at least two such tests annually.

Regarding procedures and methods, the “Testing Guidelines” detail the steps securities firms should follow during stress testing. The specific process includes clarifying testing objectives, developing testing plans, preparing for testing, executing tests, analyzing data, and submitting and archiving reports. The guidelines also specify detailed requirements and operational methods for each of these steps to ensure the standardization and effectiveness of stress testing work.

For result application, the “Testing Guidelines” require securities firms to promptly identify issues and potential risks related to system performance and take effective measures for quick resolution. They should also regularly evaluate the effectiveness and applicability of stress testing methods and continuously improve the management mechanism. Based on this, the guidelines reference the testing report templates attached to the Testing Guidelines to standardize report content and strengthen document management, ensuring the normativity, completeness, and traceability of testing materials and reports.

In terms of self-regulation, the “Testing Guidelines” clearly state that the CSSA may organize at least one stress testing assessment of securities firms’ trading and settlement systems annually. For securities firms that fail to conduct stress tests as required, do not submit reports, fill out reports improperly, submit false or incomplete materials, or whose test results significantly deviate from actual conditions, the CSSA will urge rectification and report to the local securities regulatory bureaus.

The CSSA states it will strengthen self-regulation of stress testing work by continuously improving the industry’s trading and settlement system stress testing framework, enhancing overall risk prevention and control levels, and laying a solid foundation for building a safe, efficient, and stable capital market system.

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Editor: Gao Jia

【Source: Securities Daily】