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Euro rates Swiss competition commission fines banks

JP Morgan was one of the banks involved in the cartels

(AP Photo/Seth Wenig)

The Swiss competition commission (COMCO) has fined several international and Swiss banks for forming cartels to collaborate on different interest rates derivatives.

According to the announcement on Wednesday, different investigations found that the following banks took part: Credit Suisse, UBS, Deutsche Bank, US financial institutions Citigroup and JPMorgan, British banks Barclays and the Royal Bank of Scotlan, and the French Société Générale.

The total fines add up to CHF99 million ($96 million). The investigation began in 2012, and since then COMCO has looked through around nine million electronic pages of information and phone records. The commission said that 16 banks and five brokers were involved.

Euro interest rate derivatives

COMCO found that the banks formed a cartel “aimed at distorting the normal course of pricing components” for the derivatives. Between 2005-2008 Barclays, Deutsche Bank, Royal Bank of Scotland and Société Générale collaborated for different lengths of time on the euro interest rates.

Deutsche Bank has been given full immunity and will not pay a fine, for bringing the case to the commission, while a total fine of CHF45.3 million will be paid in varying amounts by the other financial institutions involved.

COMCO said traders at the banks had “occasionally discussed their bank's submissions for the calculation of the EURIBOR as well as their trading and pricing strategies”.

Investigations into BNP Paribas, Crédit Agricole, HSBC, JPMorgan and Rabobank are still ongoing.

Yen interest rate derivatives

Between 2007-2010 the commission found several different incidents of violations of competition law, involving Citigroup, Deutsche Bank, JPMorgan and Royal Bank of Scotland.

The total fine is CHF14.4 million, and the banks are paying varying amounts.

Investigations continue into the practices of HSBC, Lloyds, Rabobank and UBS, and against the Interdealer/Cash Brokers ICAP, RP Martin and Tullett Prebon.

Swiss franc Libor benchmark

COMCO found that the Royal Bank of Scotland (RBS) and JPMorgan worked together to influence the Swiss franc Libor benchmark between 2008-2009.

JPMorgan will pay CHF33.9 million, but RBS will not have to pay a fine as it went to Weko with the information.

Swiss franc interest rate derivatives

Credit Suisse, JPMorgan, RBS and UBS were found to have collaborated over Swiss franc interest rate derivatives between May and September in 2007. UBS has been spared a fine for coming forward to COMCO. The other banks however will have to pay CHF5.4 million.

The COMCO decision is subject to appeals at the Federal Administrative Court. and agencies/JF

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