Nomura may appeal EU antitrust fine
Nomura Holdings, Inc has published a statement following the decision by the European Commission on May 20, 2021 to fine several big investment banks, including Nomura, for participation in a bonds trading cartel.
The regulator issued a Decision and associated fine of EUR 129,573,000 on Nomura Holdings and Nomura International plc (“NIplc”), a U.K. subsidiary of the company, for the infringement of European Union competition law as a result of certain historic behavior by two former NIplc employees.
The Commission found an infringement in respect of anti-competitive conduct in the European Economic Area for a period of approximately 10 months in 2011 in connection with the primary and secondary markets for European Government Bonds.
“After thoroughly examining the content of the Decision, Nomura will consider all options, including an appeal”.
Nomura says it has already set aside a provision for the full amount of the fine and therefore the Decision will not have a negative impact on the company’s consolidated results for the fiscal year ending March 2022.
Seven investment banks participated in a cartel through a group of traders working on their EGB desks and operating in a closed circle of trust. These traders were in regular contact with each other mainly in multilateral chatrooms on Bloomberg terminals.
In these chatrooms, the relevant traders exchanged commercially sensitive information. They informed and updated each other on their prices and volumes offered in the run up to the auctions and the prices shown to their customers or to the market in general. They discussed and provided each other with recurring updates on their bidding strategy in the run up to the auctions of the Eurozone Member States when issuing Euro denominated bonds on the primary market, and on trading parameters on the secondary market.
The conduct partially took place during the financial crisis and more specifically between 2007 and 2011, and affected the entire European Economic Area (‘EEA’).
The behaviour of the seven banks violates EU rules that prohibit anticompetitive business practices such as collusion on prices (Article 101 of the Treaty on the Functioning of the European Union and Article 53 of the EEA Agreement).