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Monday 18

June, 2018 1:42 PM



Bank shares fall after ANZ cartel charges

Bank shares fall after ANZ cartel charges

Shares in Australia's big four banks have dropped, despite an overall positive market, after criminal charges were laid against ANZ.

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By AAP 06.06.2018 11:46 AM

Shares in the big four banks have dropped after criminal charges were laid against ANZ over its 2015 capital raising.

The finance sector was one of just two sectors to fall in a broadly positive start to trade on the ASX on Wednesday, after the Australian Competition and Consumer Commission late on Tuesday confirmed ANZ, Deutsche Bank and Citigroup had been charged with criminal cartel offences in relation to the August 2015 placement.

ANZ shares were down 0.4 per cent after 90 minutes of trade, and its three rivals were even weaker, with Commonwealth Bank the worst performer, down 1.1 per cent.

The benchmark ASX200 index was up 0.4 per cent.

ANZ group treasurer Rick Moscati, Citigroup executives John McLean and Itay Tuchman, former Citi country head for Australia Stephen Roberts, and former Deutsche executives Michael Ormaechea and Michael Richardson have also been charged.

The charges relate to trading in ANZ shares by Deutsche Bank and Citigroup, while ANZ and the executives charged are alleged to have been knowingly concerned in some or all of the alleged conduct.

Citigroup has already said the allegations that the underwriters of the placement acted improperly fall within a regulatory grey area.

That raises the prospect that a Federal Court ruling against ANZ and its underwriters would set a precedent for examination of other placements.

"The allegations involve an area of financial markets activity that has not been considered by any Australian court or addressed in any regulatory guidance notes previously published by the ACCC or the Australian Securities and Investments Commission (ASIC)," Citi said on Friday after the regulator flagged the issue.

"This is a highly technical area and if the ACCC believes there are matters to address, these should be clarified by law or regulation or consultation."

Deutsche on Tuesday reiterated its belief that it, Mr Ormaechea and Mr Richardson acted responsibly, in the interests of clients, and in a manner consistent with law and market integrity rules.

"Both Michael Ormaechea and Michael Richardson are highly regarded and have our full support," Deutsche said in a statement.

"We will vigorously defend charges."

Shares in ANZ fell 1.5 per cent on Friday when the ACCC flagged the issue and have continued to drift lower since.

ANZ has not commented on the charges since Friday.

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