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SIBOR rate scandal embroils ANZ and Macquarie

SIBOR rate scandal embroils ANZ and Macquarie

(17 June 2013 – Singapore) On Friday the Monetary Authority of Singapore (MAS) alleged 133 traders tried to manipulate the Singapore interbank offered rate (SIBOR), swap offered rates (SOR) and currency benchmarks – allegations which embroil Australia’s ANZ Bank and Macquarie.

Singapore’s monetary authority censured 20 banks from around the world banks for trying to rig benchmark interest rates and ordered them to set aside as much as S$12 billion (A$10 billion) at zero interest pending steps to improve internal controls.

A spokesman for ANZ said the bank had identified behaviour from certain employees that was "inappropriate" but no one had been dismissed.

"Whilst the MAS Review produced no conclusive finding that SIBOR, SOR and FX Benchmarks were successfully manipulated, they found the conduct of a number of traders at banks lacked professional ethics," the spokesman said.

"No-one has been dismissed, however appropriate disciplinary action has been taken with a small number of staff."

In response to what the MAS judged were inadequate risk procedures, the 20 banks will required to set aside additional statutory reserves with the central bank.

Both Macquarie and ANZ were part of a group of banks identified by the MAS that will have set aside between S$100 million and S$300 million with the central bank.

This was less than the requirement imposed on banks seen to have made more serious breaches, with UBS, ING and Royal Bank of Scotland forced to set aside between S$1 billion and S$1.2 billion.

The document said Macquarie was not a contributing bank to the setting of benchmark interest rates, which are administered by the Association of Banks in Singapore.

ANZ said the requirement would not have a material impact on its Singapore operations, and it had overhauled its rate setting processes and lifted training standards.

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