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Australian ‘Big Four’ constituent – as long as you’re talking about the banks and not accounting firms – ANZ Group Holdings (ASX:ANZ) has landed in the news cycle on Monday for all the wrong reasons, with ASIC to scalp $80 million off the bank for unconscionable conduct and up to a further $160M for other matters – including briefly sinking the Australian bond price.
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But, as ever, Australian investors haven’t been too bothered by a lawsuit and some bad press. ANZ shares were in the red on Monday in morning trades, but only in line with a broader market downturn that has defined September. When it comes to any kind of strong response to the lawsuit, that’s not been evident whatsoever.
Interestingly, this time the ‘victims’ of ANZ’s conduct haven’t just been homeowners and Australians in financial distress (par for the course for bank wheeling and dealing, really), but this time the Commonwealth itself.
Forming part of ASIC’s lawsuit, following a 24-month investigation, are claims ANZ knowingly disrupted the Australian bond market by inappropriately allowing block trades on the Australian bond futures market that then dropped the price of real bonds, ultimately generating less revenue for Canberra and its discontents.
Then, of course, you’ve got claims that might sound more familiar. Charges to dead customers’ accounts; promised interest rates not paid to customers, hardship notices ignored, that kind of thing.
But the bond market thing really appears to have irked the regulator – even if, by its own calculations, it only cost the government less than $30M.
(One may wonder how that loss correlates to an overall bond deal that, in ASIC’s words, was worth $14B.)
Part of the disinterested response displayed on Monday as far as you can interpret share price action as evidence of such a thing may be due to the fact ANZ will be fighting ASIC in court on matters that don’t relate to the $80M fee, which for all intents and purposes was a settlement – suggesting ANZ don’t want to go through a discovery process in court on that matter.
ANZ last traded at $33.09/sh.
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