ANZ confirms launch of ASIC civil penalty proceedings related to institutional equity placement

Maria Nikolova

ASIC alleges ANZ should have advised the market that the joint lead managers took up about 25.5 million shares of the placement.

The institutional equity placement of Australia and New Zealand Banking Group (ASX:ANZ) from August 2015 has triggered another announcement by the bank related to a regulatory action. Earlier today, ANZ said that the Australian Securities and Investments Commission (ASIC) has advised it about the launch of civil penalty proceedings over failure to comply with disclosure obligations.

The share placement is already subject to separate proceedings launched by the Australian Competition and Consumer Commission (ACCC).

ASIC alleges ANZ should have advised the market that the joint lead managers took up about 25.5 million shares of the placement. The bank said it will defend itself against the allegations.

ANZ notes that the shares in question represented less than 1% of the shares on issue at the time and were taken up by the joint lead managers in circumstances where the book indicated the placement was covered at 103%.

Furthermore, ANZ says it is not aware of a precedent for a listed entity to disclose the take up of shares by underwriters in an equity placement.

Regulatory pressure has been mounting on ANZ over the August 2015 equity placement. In June this year, it became clear that Citigroup Global Markets Australia Pty Limited (Citigroup), Deutsche Bank Aktiengesellschaft (Deutsche Bank) and Australia and New Zealand Banking Group Ltd (ANZ) had been charged with criminal cartel offenses following an investigation by the Australian Competition & Consumer Commission (ACCC).

Criminal charges have also been laid against several senior executives: John McLean, Itay Tuchman and Stephen Roberts of Citigroup; Michael Ormaechea and Michael Richardson formerly of Deutsche Bank; and Rick Moscati of ANZ.

The charges involve alleged cartel arrangements relating to trading in ANZ shares held by Deutsche Bank and Citigroup. ANZ and each of the individuals are alleged to have been knowingly concerned in some or all of the alleged conduct. The cartel conduct is alleged to have taken place following the ANZ institutional share placement in August 2015.

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