Tell us more about our one trader‚ Investec to ask Competition Commission
Jan Bornman | 2017-02-17 19:12:10.0
Investec CEO and founder Stephen Koseff. File photo.
Investec is to approach the Competition Commission for more details about one trader implicated in the price-fixing scandal that rocked the banking industry this week.
Its statement on Friday said the allegations against the bank were confined to the conduct of one single trader.
On Wednesday‚ the Competition Commission recommended that the Competition Tribunal punish local and foreign-owned banks operating in South Africa for price-fixing.
The Times reported on Friday that analysts expected banks implicated in the price fixing to get off lightly.
The commission’s investigation started in April 2015 and goes back to 2007. Some of the implicated banks include Standard Bank‚ Absa Bank‚ Investec and other foreign owned banks.
The Times calculated that‚ with about R515-billion in income from banking operations between 2007 and 2014‚ the bank would have to pay R51-billion in fines.
But the banks would have to pay much less if the fine were calculated on the turnover of their currency units‚ Intellidex analyst Stuart Theobald said.
“The timing [of the price-fixing allegations] couldn’t be worse for the banks‚” said Adrian Saville‚ chief strategist at Citadel Investment Services and Cannon Asset Managers.
“It comes at a time when they’re trying to demonstrate their impeccable behaviour. It makes a case for intervention.”
The Treasury said on Thursday: “It should be noted that these allegations‚ if proved to be correct‚ point to poor market conduct practices at such offending institutions.”
“If proven to be true‚ it would confirm the pervasiveness of unbridled greed within the ranks of the forex trading sections of banks even after evidence that such behaviour has potential to collapse national and global financial systems and bring about immeasurable pain to ordinary people as evidenced by the deep recession of 2008-09 which was triggered by banks conducting their business recklessly.”