Four banks fined by UK regulator over gilt information sharing

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Four banks have agreed to pay fines totalling more than £100mn following an investigation by the UK’s competition watchdog into exchanges of sensitive information about the trading of gilts. 

Citi, HSBC, Morgan Stanley and Royal Bank of Canada will pay the penalties after a Competition and Markets Authority investigation found that between 2008 and 2013, individual traders at the banks shared sensitive information in private one-to-one Bloomberg chat rooms relating to buying and selling gilts on specific dates. Deutsche Bank was also subject to the probe, which opened in 2018, but has immunity for reporting its conduct.

Three of the banks received a 10 per cent reduction in the penalty for settling after the CMA raised its objections. RBC was fined £34.2mn, Morgan Stanley £29.7mn and HSBC £23.4mn. Citi was fined £17.2mn after being granted a 35 per cent leniency discount and a 20 per cent reduction for settling before the watchdog issued its objections.

The banks have since implemented extensive compliance measures, the CMA said on Friday. 

Juliette Enser, executive director of competition enforcement at the CMA, said: “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.”