ANZ has provided an update on investigations into its execution of a 2023 issuance of Treasury bonds by the Australian Office of Financial Management (AOFM).
In a statement to the ASX on Thursday, the bank shared there have been “employment outcomes” for several employees, including suspension, termination, and a formal warning while an internal investigation remains underway.
“With the assistance of external counsel, we are investigating these issues with the urgency expected and the group board continues to supervise this work closely,” said ANZ chief executive Shayne Elliott.
“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.”
He added the board will also lead a process to ensure consequences will be applied to senior executives, both past and present, including himself.
The bank indicated management changes in the Sydney dealing room have also been made.
Earlier this year, the bank confirmed that the Australian Securities and Investments Commission (ASIC) was investigating the 10-year Treasury bond issuance, particularly looking into “suspected contraventions of a number of provisions of the ASIC Act and the Corporations Act”.
At the time, ANZ confirmed it is cooperating “fully” with ASIC and said it takes compliance with its regulatory obligations “seriously”.
In its latest update, ANZ explained it had informed the AOFM in August 2023 it had submitted incorrect monthly secondary bond turnover data for the FY2022–23 year.
“Data errors were caused by a range of issues including process and data extraction errors on ANZ’s part. This resulted in the incorrect inclusion of transactions that should have been omitted as well as double counting of some transactions,” it said.
“ANZ acknowledges this is an unacceptable failure.
“It is also investigating whether it should have reported this issue to [ASIC] earlier than it did and will engage with ASIC further on this matter.”
The CEO added he has “personally apologised” to the AOFM for ANZ’s failures.
Commenting on the ASIC investigation, Elliott said ANZ’s external counsel has engaged independent experts to analyse trading data in relation to this issue, which remains ongoing.
The bank’s own preliminary analysis has not identified any evidence of market manipulation, he continued; however, ANZ “does not have all the information that ASIC has, and this position will be reviewed in coming months”.
“We have also 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,” he said.
“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.”
In the statement, the CEO said his priority remains that “the investigations are completed in a timely manner, that action is taken against any individuals who have not met the required standards and that the necessary steps are taken to ensure these conduct failures do not re-occur”.
“Importantly, we are not limiting our reviews and will address any conduct that is not in line with our expectations,” he said.
