Date: 19/10/2000

The London stockmarket's automatic settlement system,
Crest, yesterday "lost" a #30 billion ($83.5 billion)
company, after becoming confused about a capital
reshuffling by the insurance firm Zurich Financial
Services.

Investors were left in limbo for much of the day as
millions of pounds worth of shares in the company
disappeared from their settlement accounts overnight.

The confusion arose after London-based Allied Zurich,
which owned 43 per cent of Zurich Financial Services,
was absorbed into the Swiss company on Monday. Investors
ought to have been automatically allocated shares in the
combined organisation, which has a primary listing in
Switzerland and a secondary quote in London.

But a "technical error" meant that all trace of the
insurance company disappeared from Crest's systems,
which are used by nearly all institutions trading in
blue-chip shares. A Crest spokesman said: "The cross-
border corporate action was an immensely complicated
one. There were technical issues which meant that the
out-turned security which should have appeared in
settlement accounts was slightly delayed."

Sydney Morning Herald

-- spider (spider0@usa.net), October 23, 2000