Rabobank was hit with a $29 million EU fine over the 2006–16 bond cartel. On Wednesday, the European Union’s antitrust inspectors punished 26.6 million euros ($29 million) of the Dutch bank Rabobank for participating in a bond trading cartel involving euro-denominated bonds over ten years.
In recent years, antitrust authorities worldwide have handed out fines totaling billions of euros to banking institutions for manipulating vital financial benchmarks and currencies.
According to the European Commission, the cartel was primarily concerned with euro-denominated SSA bonds (supra-sovereign, foreign sovereign, and sub-sovereign/agency bonds) and government-guaranteed bonds traded in Europe. The cartel was active between 2006 and 2016.
In response to the global financial crisis that began in 2008, the government issued bonds with guaranteed interest rates for a limited time.
After Deutsche Bank (DBKGn.DE) tipped off the European Union’s competition agency in 2017 about the cartel, the watchdog launched an inquiry that year, which resulted in the bank avoiding a punishment of over 156 million euros.
According to the Commission, the traders performed their activities at the EUR SSA desk of Deutsche Bank in Frankfurt and Rabobank’s Investment Grade Bonds desk in London. They shared information on pricing, volumes, and present and prospective trading plans and positions.
It was stated that the traders spoke with one another via instant chats, internet chatrooms, and emails sent from Bloomberg.
“Trustworthy and well-functioning bond trading markets are crucial not only for the national authorities that are issuing bonds but also for the investors buying and trading,” the head of antitrust enforcement for the European Union, Didier Reynders, said in a statement.
