ANZ surprises with deal in rate case
NATIONAL Australia Bank and Westpac are in feverish negotiations with the corporate cop before a possible settlement in the legal battle against rate-rigging allegations.
ANZ stunned the other banks yesterday when it revealed it had settled with the corporate regulator on the first morning of an expected threemonth court case over the allegations.
The Australian Securities and Investments Commission had sued all three banks, accusing them of manipulating the bank bill swap rate — a key inter-bank lending rate that affects interest rates across the banking system.
ANZ is believed to be forking out more than $50 million in fines to settle the action, but it was unclear last night whether the bank would acknowledge any guilt.
Lawyers for the lender were walking a fine line, industry experts said, as it wanted to end the lawsuit without exposing itself to the threat of a class action by disgruntled customers.
The details of their agreement — to be inked between ANZ and the regulator’s lawyers today — are expected to be revealed in court tomorrow.
Representatives for NAB and Westpac are scheduled to appear at the Federal Court in Melbourne tomorrow to contest similar allegations.
All three lenders had been accused of manipulating the bank bill swap rate to profiteer at the expense of customers.
The regulator launched a series of actions against the banks over the issue in March last year.
If Westpac and NAB join ANZ in buckling, it will be seen as a major win for ASIC chairman Greg Medcraft in the twilight of his leadership.
Mr Medcraft is due to retire on November 12.
The Australian banking industry is trying to avoid negative publicity amid calls for a royal commission into the conduct of lenders, who have been embroiled in a series of controversies in recent years.