Four banks have agreed to pay a total of £104m to settle a competition case with the Competition and Markets Authority.
HSBC, Morgan Stanley, Citi and Royal Bank of Canada have agreed to pay fines for specific instances in which traders shared competitively sensitive information about aspects of the pricing of UK bonds.
The sharing of information occurred in one-to-one exchanges between traders about the buying and selling of gilts and gilt asset swaps on specific dates.
Gilts are an important type of UK government bond that help to finance public spending. Investors in gilts lend money to the UK government and in return receive a steady and stable stream of cash interest payments.
Healthy competition drives investment, innovation and growth, and it is important that competitors decide their price and strategies independently in order to ensure effective competition in a market, the CMA said.
This conduct took place on various dates between 2009-2013, with the last exchanges occurring in 2010 for HSBC, 2012 for Morgan Stanley, and 2013 for each of Citi, Deutsche Bank and Royal Bank of Canada.
Since then, the banks have implemented extensive compliance measures to ensure this behaviour does not happen again, the CMA said.
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Four banks – Citi, HSBC, Morgan Stanley and Royal Bank of Canada – have settled and agreed to pay fines totalling £104,460,000.
Deutsche Bank is exempt from a financial penalty as it alerted the CMA to its participation in the chats via the authority’s leniency policy. Citi applied for leniency during the CMA’s investigation and as a result has received a reduced fine.
Citi will pay £17,160,000, which includes a 35% leniency discount and a 20% reduction for settling in advance of the CMA issuing its Statement of Objections.
HSBC will pay £23,400,000, which includes a 10% reduction for settling after the CMA issued its Statement of Objections.
Morgan Stanley will pay £29,700,000, which includes a 10% reduction for settling after the CMA issued its Statement of Objections.
Royal Bank of Canada will pay £34,200,000, which includes a 10% reduction for settling after the CMA issued its Statement of Objections.
“Following constructive engagement between the banks and the CMA, we are pleased that we have been able to settle these five cases involving the past sharing of competitively sensitive information about pricing,” said Juliette Enser, executive director of competition enforcement at the CMA.
“The financial services sector is an integral part of the UK economy, contributing billions every year, and it’s essential that it functions effectively. Only through healthy and competitive markets can we ensure businesses and investors have confidence to invest and grow – for the benefit of all in the UK.
“The fines imposed today reflect the CMA’s commitment to dealing with competition law breaches and deterring anti-competitive conduct. The fines would have been substantially higher had the banks not already taken unusually extensive steps to make sure that this doesn’t happen again.”
The fines take into account the length of time that has passed since the end of the infringements and the extensive compliance measures that the banks have implemented since then – some of which were in place before the start of the CMA’s investigation.
The firms have until 22 April 2025 to pay their fines.