The London Stock Exchange (LSE) has brought its IT service delivery team back in-house, in recognition of the core role that computer systems now play in its business.
Earlier this month, the LSE reported that revenues were up 20% and operating profits were up 55% for the year ending March 31, driven by a surge in high-speed electronic trading.
In a statement issued with the annual results figures, the exchange drew attention to new trading patterns developing with the advent of higher-speed electronic systems.
“We are seeing a permanent shift in the nature of order flow as new, higher velocity electronic (algorithmic/black box) trading strategies are increasingly deployed by hedge funds, intermediaries and specialist technical trading firms.”
The LSE is now reshaping its IT function to take account of the central importance of the trading systems to its business, with up to 150 staff transferring back from contractor Accenture. The employees operate and maintain the exchange’s trading systems, opening the market systems in the morning and closing them at the end of trading.
The move comes as the exchange prepares to launch its new TradElect platform — the culmination of its four-year new technology roadmap.
An LSE spokesperson said: “Tech-nology basically underpins our competitive advantage, so we’re keen to bring the expertise in-house and continue to invest in it. The Exchange is basically a technology business these days. Investment in technology and keeping these systems up and running is key.” The Exchange hasn’t dropped Accenture, however — it has signed a two-year extension to its software development contract with the services firm, continuing the 15-year relationship it has with the company.