The UK Competition and Markets Authority (CMA) has imposed a total fine of £104.46m on Citi, HSBC, Morgan Stanley, and the Royal Bank of Canada (RBC) for exchanging sensitive information related to UK government bonds.
The fines follow an investigation into traders’ one-on-one discussions about the pricing and trading of gilts and gilt asset swaps.
The British competition watchdog found that between 2009 and 2013, traders at these banks shared competitively sensitive details in bilateral Bloomberg chatrooms.
HSBC’s last recorded exchange took place in 2010, while Morgan Stanley was involved until 2012. Citi and RBC continued the practice until 2013.
The information exchanges covered three key areas, namely the sale of gilts by the UK Debt Management Office via auctions on behalf of HM Treasury, the subsequent trading of gilts and gilt asset swaps, and the sale of gilts to the Bank of England under its buyback programme.
Individually, Citi has been fined £17.16m, HSBC £23.4m, Morgan Stanley £29.7m, and RBC £34.2m.
Citi’s penalty was reduced due to its leniency application during the investigation, securing a 35% discount alongside a 20% reduction for settling early.
HSBC, Morgan Stanley, and RBC each received a 10% discount for settling after the CMA issued its Statement of Objections.
Deutsche Bank, also implicated in the information-sharing, avoided a fine after voluntarily reporting its involvement under the CMA’s leniency policy.
CMA Competition Enforcement Executive Director Juliette Enser 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.”
The CMA acknowledged that all banks had since introduced extensive compliance measures to prevent similar conduct. The investigation has now concluded, and the fined banks must pay by 22 April 2025.
