Readers will be familiar with headlines over the last couple of years concerning banks in Europe manipulating Libor. Recently the story has taken on a far more local flavour as ANZ revealed that seven traders caught up in investigations by the ASIC into possible manipulation of the Bank Bill Swap Rate had stepped down. ANZ told the ASX after the market had closed that it was “continuing to co-operate” with an ASIC investigation into historical trading in the BBSW market.
A statement from ANZ said, “We have been treating this matter very seriously and we are continuing to cooperate fully with ASIC. This is a complex issue and ASIC’s investigation and ANZ’s internal review may not be complete for some time. In light of this, we are taking the precaution of having seven staff involved in markets trading step down pending completion of the investigation into practices to 2013.”
This is the first time that one of the big four has been embroiled in a potential rate fixing scheme. Already RBS, UBS and BNP Paribas have paid fines for their role in manipulating BBSW and ASIC’s investigation into BBSW could result in both civil and criminal penalties.