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AMSTERDAM, June 15 (Reuters) - The European Union has
excluded some of the biggest investment banks with past
involvement in breaches of antitrust rules from syndicated debt
sales backing its up to 800 billion euro ($969 billion) COVID-19
recovery fund, the EU executive said on Tuesday.
"The Commission will be undertaking a careful assessment of
whether the primary dealers found guilty of breaching anti-trust
rules have taken necessary remedial measures to terminate these
practices and are ready to undertake to take steps to avoid
their recurrence," the European Commission said in a statement
to Reuters.
"Pending the completion of this assessment, these
institutions will be admitted to the primary dealer network but
will not be invited to tender for individual syndicated
transactions," it added.
The Commission did not specify which banks were excluded,
but a spokesperson for the Commission pointed to three cartel
cases over the last three years which involved 10 of the bloc's
biggest primary dealer banks.
It fined banks including Bank of America, Credit
Agricole, Natixis, Nomura, Natwest Markets (formerly
RBS) and UniCredit for breaching antitrust rules by
participating in bond cartels in two separate cases in April and
May this year.
Deutsche Bank also participated in one of the cartels but
was not fined as it revealed the cartel to the Commission.
Barclays, Citigroup, JPMorgan and Natwest
were fined in 2019 for rigging the foreign exchange market.
Those banks are among the EU's 39 primary dealers, which
manage syndicated debt sales for the bloc -- where they sell the
debt directly onto end investors -- for lucrative fees. This
helps motivate them to participate in less lucrative debt
auctions, which the EU will start from September.
Spokespeople for Nomura, BofA, Barclays, Natixis, Credit
Agricole, NatWest, Deutsche Bank, UniCredit, Citi and JP Morgan
all declined to comment.
The spokesperson said the banks "at some point" would rejoin
the syndications.
The Financial Times reported the news on Tuesday following a
report by Refinitiv's capital markets news service IFR on
Friday.
The European Union on Tuesday raised 20 billion euros
($24.25 billion) from the first bond backing its recovery fund
on the back of near-record demand.
That deal was led by joint lead managers BNP Paribas, DZ
Bank, HSBC, IMI-Intesa Sanpaolo and Morgan Stanley, while Danske
Bank and Santander are co-lead managers.
($1 = 0.8253 euros)
(Reporting by Yoruk Bachceli and Dhara Ranasinghe;
Editing by Rachel Armstrong and Emelia Sithole-Matarise)
