ZCZC
BCN-42
EU-EUROZONE-BONDS-DEBT
EU accuses 8 banks of forming eurozone bond cartel (lead)
BRUSSELS, Jan 31, 2019 (BSS/AFP) – The EU’s powerful anti-trust sheriff on
Thursday accused eight banks of having conspired for several years to distort
competition in the eurozone bond market.
According to the European Commission, the banks colluded to distort
competition when acquiring and selling eurozone government bonds in periods
from 2007 to 2012, at the height of the financial crisis.
The Brussels-based commission refused to name the banks, but Credit Suisse,
Credit Agricole and Deutsche Bank earlier revealed that they were in the EU’s
crosshairs for bond trading collusion.
The accusation deals a fresh blow to the banking industry which has spent
years recovering from a series of crisis-era scandals including manipulation
of the Libor lending rate and other key benchmarks.
Much like those scandals, the commission said the collusion in this case
took place “mainly — but not exclusively — through online chatrooms”.
The EU, which is not bound by any legal deadline in the investigation,
could impose a fine of up to 10 percent of each bank’s annual turnover if its
allegations are confirmed.
The Libor and other scandals resulted in massive fines, slashed bonuses and
tighter regulation for the banking industry, putting a close to a free-
wheeling era.
The cases had resulted in the payment of several hundred million euros in
fines for large banks, as well as a number of lawsuits.
BSS/AFP/SR/2010 HRS