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ANZ Bank Suspends Staff Amid Rate-Fixing Investigation

"UBS Is Reported to Be Near a Deal on Rate Rigging"

Probe Examines Suspected Rigging of Australia’s Interest-Rate Benchmark

IMAGE: An Australia & New Zealand Banking Group building in Sydney. The bank is facing investigations into suspected rigging of Australia’s interest-rate benchmark. SAEED KHAN

By Ross Kelly Updated Nov. 20, 2014 1:44 a.m. ET

SYDNEY— Australia & New Zealand Banking Group .. http://quotes.wsj.com/ANZ.AU .. Ltd. said it has suspended seven staff pending investigations into suspected manipulation of Australia’s interest-rate benchmark.

Since 2012, Australia’s corporate watchdog has been probing more than a dozen local and foreign banks in relation to trading in Australia’s bank bill swap rate market. ANZ has also been conducting its own internal investigation of possible misconduct.

It could take some time before either investigation is completed, Nigel Wilson, ANZ’s chief risk officer, said in a statement Wednesday. “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.”

The Australian figure, set daily by a group of 14 local and offshore banks, is used to determine interbank lending rates, providing a pricing reference for a range of financial products and contracts.

The separate investigations come after a rate-fixing scandal that has engulfed some of the world’s largest financial institutions. Libor, or the London interbank offered rate, is a similar mechanism to Australia’s bank bill swap rate but is used on a much larger scale, including in European and U.S. financial centers.

The Libor manipulation scandal has ensnared dozens of financial institutions and individuals in a wide-ranging investigation spanning almost a dozen countries. So far, it has netted billions of dollars in penalties.

Some of the banks caught out in the Libor scandal are also involved in setting Australia’s bank bill swap rate. The Australian arms of UBS .. http://quotes.wsj.com/UBS .. AG , Royal Bank of Scotland .. http://quotes.wsj.com/RBS.LN .. PLC and BNP Paribas .. http://quotes.wsj.com/BNP.FR .. SA have already paid millions of dollars in fines in Australia after the country’s corporate regulator, the Australian Securities and Investment Commission, showed they had engaged in rate-rigging. National Australia Bank .. http://quotes.wsj.com/NAB.AU .. Ltd. also has been penalized by ASIC.
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Write to Ross Kelly at [e-mail]

Corrections & Amplifications

The Australian arms of UBS, Royal Bank of Scotland and BNP Paribas have paid millions of dollars
in fines in Australia. A previous version of this article incorrectly said they had paid billions.

http://www.wsj.com/articles/anz-bank-suspends-staff-amid-rate-fixing-probe-1416378624

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