Tokyo Stock Exchange names new CIO

Tokyo Stock Exchange has appointed a new chief information officer following widespread criticism last week of its IT management.

The operator of the world’s second-largest stock market tapped Yoshinori Suzuki, a 57-year old who has spent his entire working life at Nippon Telegraph and Telephone and NTT Data Corp. He will oversee the entire IT strategy of the Tokyo Stock Exchange when he takes up the new post Feb. 1, the company said.

Trading on the exchange was halted 20 minutes early last Wednesday as a precaution against a computer system overload. It was the first time trading had been halted in such a way and the exchange was criticized by market participants and the Japanese government for not being able to handle the day’s workload.

The exchange worked over the weekend to increase capacity and plans to install a new clearing system this weekend, but the changes increase only slightly the volume of trades that can be handled.

At the time of last week’s problems the exchange had a daily limit of 4.5 million trades, and the exchange operator halted trading when the count hit 4 million. In the end, 4.32 million shares were traded. The weekend upgrade took the limit to 5 million.

The exchange has announced vague plans to increase this to 7 million or 8 million this year, but no concrete details have been offered. Part of Suzuki’s job will be to figure out by exactly how much the system should be expanded and over what timeframe.

On Wednesday this week, 2.9 million trades were executed by the exchange.

Last week’s spike was caused by investors trying to dump Livedoor stock after public prosecutors raided its headquarters. Livedoor shares dropped by the maximum daily limit for each of the six trading sessions up to Tuesday without finding any buyers, plunging from ¥696 to ¥176 by Tuesday’s close. On Wednesday they traded for the first time in more than a week and ended the day at ¥137.

The exchange had limited trading of the shares to the last 1 1/2 hours of the Wednesday session to keep the number of executed shares down. From Thursday, trading will be limited to the last hour of the session to guard against further computer problems.