Investigations into ANZ’s Australian Markets business are ongoing, with preliminary analysis by the organisation finding no evidence of market manipulation.
The Australian Securities and Investments Commission’s (ASIC) investigation into the situation, which is expected to last a number of months, considers ANZ’s issuance of 10-year Treasury Bonds by the Australian Office of Financial Management (AOFM) in 2023.
Stating that it is “cooperating fully” with the regulator, ANZ’s external counsel is in the process of gathering trading data analysis around the issue from independent experts.
Alongside this case, ANZ is also facing investigations into its data reporting processes and conduct and behavioural matters within its Sydney dealing room.
The former refers to the submission of incorrect monthly secondary bond turnover data for the full 2022-23 year to AOFM, wherein some transactions that should have been omitted were included and some transactions were counted twice. This was the result of multiple issues, ANZ stated, including process and data extraction errors.
While the erroneous reports came to light before the year-end sign-off on data accuracy was completed, ANZ acknowledged that the situation was “an unacceptable failure”. It is investigating whether the issue should have been more promptly reported to ASIC.
Shayne Elliott, chief executive at ANZ, commented: “We have reviewed recent data submissions provided to relevant customers and although there will be ongoing work, we don’t believe we have material issues with the data we have submitted. However, as an additional precaution, I have asked our internal audit team to review the governance and control frameworks supporting the production of similar submissions to customers and report its findings to the Board.
“I have personally apologised to the chief executive at AOFM for ANZ’s failures. We are significantly enhancing our governance process around this data, including building a separate validation tool and increasing training for relevant staff. We had already strengthened our breach reporting process through system improvements.”
Regarding issues of conduct and behaviour, ANZ has suspended, terminated and issued formal warnings to a number of employees as the investigation continues. Management changes have also been made in the Sydney dealing room.
Elliott summarised: “We have been very clear with our people. Where we find any evidence of wrongdoing, those involved will be held accountable and action will be taken. The board will also lead a process to ensure consequences will be applied to senior executives, both past and present, including myself, where appropriate.”
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