TSX Group Inc. today reported that its second-quarter profit rose 37% on the back of higher revenue from market data and issuer services, and lower taxes.

The operator of Toronto Stock Exchange and the TSX Venture Exchange said net income was $39.1 million for the three months ended June 30, or 57¢ a share. That was up from $28.5 million, or 41¢ a share, in the same 2006 period.

The company said revenue grew by 15% to $106.2 million in the quarter, led by a 21% rise in issuer services revenue and a 29% increase in market data revenue.

Trading and related revenue rose only 3% despite a 23% rise in the volume of securities traded because the exchange converted to a volume-based fee structure last July. Under the fee structure, firms doing the most trading get the biggest discounts.

In the second quarter, the effective tax rate fell to 39% from about 52% a year earlier

Facing greater competition from new alternative trading systems, including one proposed by its seven biggest customers, TSX Group also said that more changes to its trading fees are on the way. It said it will provide details in August.

The fee changes will be aimed at bringing more volume to the senior board’s central limit order book, it said. The changes are “consistent with our commitment to reduce the overall cost of trading of Canadian equities,” the exchange said in a news release.

TSX Group also announced plans to buy back up to 10% of its shares.