Citi, HSBC, Morgan Stanley, and Royal Bank of Canada (RBC) have agreed to pay a combined total of £104.46 million in fines after an investigation by the UK Competition and Markets Authority (CMA). The investigation uncovered instances where traders at the banks shared sensitive pricing information regarding UK government bonds, specifically gilts and gilt asset swaps, between 2009 and 2013.

The illegal exchanges took place in private, one-to-one online chatrooms on Bloomberg, where traders discussed aspects of UK government bond pricing, including the sale and subsequent trading of gilts by the UK Debt Management Office, as well as the Bank of England’s “buy back” transactions. These exchanges took place over several years, with the last activity recorded in 2013.

Banks Pay £104 Million in Fines After CMA Investigation

The fines vary by institution. Citi will pay £17.16 million, which includes a 35% leniency discount and an additional 20% reduction for settling early in the process. HSBC will pay £23.4 million, Morgan Stanley will pay £29.7 million, and RBC will pay £34.2 million. All three banks received a 10% reduction in settlement after the CMA issued its Statement of Objections.

Deutsche Bank, which was also involved in the exchanges, was exempted from a fine after it alerted the CMA of its participation under the authority’s leniency policy.

The fines reflect the duration of the infringements and the banks’ implementation of extensive compliance measures since the incidents. These measures were there well before the CMA’s investigation began.

As part of the settlement, the banks have agreed to pay the fines by 22 April 2025, marking the conclusion of the CMA’s investigation into their conduct in the UK bond market.

The penalties reflect the seriousness of the misconduct, while the banks’ implementation of extensive compliance measures signals their commitment to preventing such behavior in the future. The conclusion of this investigation highlights the ongoing scrutiny within financial markets and reinforces the importance of regulatory oversight to ensure fair and transparent trading practices.

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