ABOVE: A woman uses an ATM at a branch of Barclay’s South African subsidiary Absa bank in Johannesburg. File photo. Image by: SIPHIWE SIBEKO/REUTERS/TIMES LIVE
Barclays Africa – aka Absa – asked for forgiveness yesterday for its role in rigging the rand , a scandal that has raised questions over the dominance of the big four local banks.
“We deeply regret that this conduct took place within our organisation,” CE Maria Ramos said. “Those who are found to have contravened our rules … will be held accountable.”
The Competition Commission said last week it had found more than a dozen local and foreign banks had colluded to co-ordinate trading in the rand and the US dollar using an instant chat room called ZAR Domination, a reference to the rand’s market code.
It recommended fines amounting to 10% of the banks’ South African revenues and piled political pressure on the four banks, which have about 90% of the national banking market.
The commission began its investigation in April 2015, joining an international probe into the manipulation of foreign exchange rates that has already led to big banks paying more than $10-billion in settlements.
Absa, a regional unit of UK’s Barclays, has already been granted conditional immunity from prosecution in return for supplying information that might lead to the successful prosecution of the other alleged cartel members.
Standard Bank, which is also among the 17 named in the investigation, said yesterday it was in talks with the watchdog. No employees had been suspended.
“Pending the outcome of these engagements and in the light of these historic allegations only having been brought to Standard Bank’s attention on February 15, no suspension of current employees of Standard Bank has taken place,” it said.
The local arm of Citigroup agreed to pay a reduced $5-million penalty for co-operating in the investigation; Investec has said it will seek information from the regulator about co-operating.
Finance Minister Pravin Gordhan said in his Budget speech on Wednesday that the government would crack down on anti-competitive behaviour with new regulations.
The scandal has weakened the share prices of South Africa’s listed banks. The sector index dropped by about 1% by mid-session yesterday.
Former Citigroup foreign exchange dealer Christopher Cummins and Jason Katz, who worked at Barclays and later BNP Paribas SA, last month pleaded guilty in the US to conspiring to fix currency prices.
Both, with others, are named in the South African regulator’s report on its investigation that has been referred to the Competition Tribunal, which holds hearings on antitrust matters before giving a ruling.