ASX chief executive Helen Lofthouse has said the market operator recognises the “serious nature” of the legal proceedings the corporate regulator launched this week, as it reported a slight decline in annual profit to $474 million as higher regulatory expenses took their toll on returns.

The 3.4 per cent drop in underlying profit was mostly due to higher operating expenses as ASX updates several core systems, including the second version of the equity post-trading system known as CHESS, and beefs up staffing to respond to tougher regulatory demands.