JPX Forms Committee to Investigate TSE System Failure

The TSE said a failure occurred in a memory module of an Arrowhead shared disk device, where operations did not switch over to a secondary device due to a device setting.

JPX (Japan Exchange Group) on Monday (5 October) announced the establishment of a committee to investigate the system failure that occurred at the TSE (Tokyo Stock Exchange) last Thursday (1 October).

The ‘System Failure Investigation Committee’ is comprised of four independent outside directors of JPX, who are tasked with investigating the cause(s) of the system failure, the response to the failure, and measures to prevent similar incidents occurring in future to maximise their effectiveness.

The committee will also examine policies for improving the reliability of systems of the entire JPX group and identify the locus of responsibility for the incident. An expert may be selected to assist the committee on an as-needed basis, JPX said.

The TSE has meanwhile issued a statement apologising for the inconvenience caused to investors and other market users due to the failure in its Arrowhead cash equity trading system.

The statement outlines the direct cause of the failure and the measures implemented to address the system issue. It says a failure occurred in a memory module of an Arrowhead shared disk device. Operations were supposed to switch automatically to a secondary device, but the switching action did not function as expected.

It was later found that the automatic switching would only function following a memory module failure if a device setting were changed. This change was implemented on Sunday (4 October), and TSE has since confirmed that automatic switching is now functional.

“To prevent similar incidents, we are considering further actions, including further analysis of the cause, reassessment of system settings, and other preventative measures,” TSE said.

According to local reports, Fujitsu president Takahito Tokita also apologised for the system glitch on Monday (5 October), vowing to fully investigate the cause of the malfunction. Fujitsu developed the Arrowhead system, and updated the system last November.

“We deeply apologise for causing significant trouble to the Tokyo Stock Exchange, market participants and many others,” Tokita said during an online briefing. “We will continue to make all-out efforts to look into the cause (of the glitch) and prevent a recurrence.”

The system failure “shook confidence in the Japanese financial system,” Tokita admitted, saying Fujitsu will seek to restore trust with its technology and expertise.