While presenting ANZ's latest financial results, outgoing CEO Shayne Elliott maintained that the current Australian Securities & Investments Commission (ASIC) investigation into alleged market misconduct at the bank is unrelated to past scandals, as reported by The Australian.
The probe concerns claims that ANZ traders traded ahead of an A$14 billion government bond deal, benefiting the bank at taxpayers' expense. Elliott argued that this differs from the earlier manipulation of the Bank Bill Swap Rate (BBSW), which occurred from 2010 to 2012, when he led ANZ's Institutional division. He conceded that the bank fell short on managing non-financial risk but insisted that lessons from the past were not ignored.
The bank's regulators seem to disagree. Last month, the Australian Prudential Regulation Authority (APRA) increased ANZ's operational risk capital add-on from A$750 million to A$1 billion and entered into a Court Enforceable Undertaking with the bank due to persistent non-financial risk management concerns.
"ANZ remains financially sound with robust levels of capital and liquidity, however problems with the bank's management of non-financial risks are persistent and prevalent across the bank," said APRA Chair John Lonsdale. "APRA has seen how long-standing non-financial risk management weaknesses have manifested in material prudential issues at some of ANZ's peer banks. We have observed some similar weaknesses at ANZ and require these to be addressed as a priority."
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