Documents reveal document dump on ASIC as regulator probed ANZ-AOFM $14bn debt deal

The corporate regulator was demanding detailed information on government bond transactions involving ANZ in January this year, as it sought to unravel a contentious $14bn bond placement.

ANZ only revealed to investors it was facing a full-blown investigation from the Australian Securities and Investments Commission in mid-May. Picture: Getty Images

Documents reveal ASIC was demanding detailed information on past government bond transactions involving ANZ in January this year, as it sought to unravel a contentious $14bn bond placement, a Freedom of Information request has shown.

Correspondence released to The Australian shows the Australian Office of Financial Management shared at least 22 documents concerning ANZ Bank with the corporate regulator between January and May 2024, months before the scandal exploded.

ANZ only revealed to investors it was facing a full-blown investigation from the Australian Securities and Investments Commission in mid-May, amid concerns its traders had manipulated the sale of government debts in April 2023.

ASIC is investigating allegations that ANZ traders forced down the price of bond futures in a bid to frontrun a major government placement, in a move which resulted in the government’s borrowing costs soaring.

One document released to The Australian shows ASIC demanded information about past risk manager reports on January 29, with the AOFM handing over a number of minutes concerning the selection of the joint lead managers for the 2023 debt issuance.

An email from the AOFM to ASIC shows a staff member delivering a document showing approvals under section 23 of the Public Governance, Performance and Accountability Act, noting “as requested mate”.

A letter from the AOFM, which denied access to the 21 other documents, shows ASIC was handed a further 11 attachments in this January correspondence.

This was followed by a further seven emails, with two further attached documents, handed over by the AOFM between January and May this year.

The AOFM warned the release of these documents would threaten ASIC’s ongoing investigation into ANZ, with chief executive Erin Martin warning “disclosure of these documents could reasonably be expected to have an adverse effect on the proper conduct of this and any future investigations”.

Ms Martin notes many of the attachments provided in January to ASIC “contain highly sensitive market information provided by ANZ to AOFM, in ANZ’s capacity as Duration Manager in relation to a syndicated issue”.

“This information was specifically identified, and communicated and received on the basis of a mutual understanding of confidence,” she said.

“ANZ has not consented to the disclosure of this information and disclosure would thereby be without authority. Further, disclosure of this material would cause detriment to ANZ as it would provide insight to their activities as Duration Manager.”

Ms Martin noted one of these documents contained the personal information of ANZ staff “not known to be (or to have been) associated with the matters dealt with in the documents”.

Ms Martin told The Australian several of these documents also contained investor allocation information which had “commercial value to ANZ”, noting their release “would diminish ANZ’s competitive advantage by informing its competitors of its strategic positioning on bond issues of this kind”.

A further document, also withheld by the AOFM, shows the agency’s deliberations for the selection of a joint lead manager on a bond placement “and contains highly sensitive market data that has significant commercial value to each of the banks considered in the selection process”.

ASIC’s investigation into the ANZ bond trading scandal, which comes after the bank faced a scandal in its trading team in 2016, now has the bank embroiled in its own internal probe.

ANZ has brought in external lawyers, as ASIC begins interviews with trading team staff.

The Australian Prudential Regulation Authority is also keeping a close eye on the scandal, with The Australian revealing the agency had opened a file on ASIC’s investigation into ANZ.

In a recent email to staff, ANZ Institutional Bank boss Mark Whelan and group Risk Management leader Kevin Corbally said the bank had already commenced action “on workplace conduct issues that have been identified”.

Originally published as Documents reveal document dump on ASIC as regulator probed ANZ-AOFM $14bn debt deal