EU Says 13 Banks Moved to Keep Competition Out of $10 Trillion CDS Market
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The European Union sent out a statement of objections to 13 banks, International Swaps & Derivatives Association, and Markit Group today over allegations that the entities colluded to eliminate competition in the credit derivatives segment.
According to the statement, the time frame involved in the probe runs from 2006 to 2009.
The banks involved are: Barclays Plc (NYSE: BCS), HSBC Holdings Plc (NYSE: HBC), Goldman Sachs Group Inc. (NYSE: GS), JPMorgan Chase & Co. (NYSE: JPM) Citigroup Inc. (NYSE: C), Credit Suisse Group AG (NYSE: CS), Deutsche Bank AG (NYSE: DB), Morgan Stanley (NYSE: MS), Bank of America Corp. (NYSE: BAC), Royal Bank of Scotland Group Plc (NYSE: RBS), BNP Paribas SA (NYSE: BNP), and UBS AG (NYSE: UBS).
Bloomberg notes today that the EU opened a probe in April 2011 to investigate whether or not the banks were giving market information to Markit. The investigation was widened to include ISDA earlier this year.
The investigation was started when CME Group (NYSE: CME) and Deutsche Borse tried to enter the market. The two were unable to acquire CDS exchange-trading licenses from ISDA and Markit per instructions from the banks, according to the EU statement.
The global CDS market is valued at about $10 trillion.
According to the statement, the time frame involved in the probe runs from 2006 to 2009.
The banks involved are: Barclays Plc (NYSE: BCS), HSBC Holdings Plc (NYSE: HBC), Goldman Sachs Group Inc. (NYSE: GS), JPMorgan Chase & Co. (NYSE: JPM) Citigroup Inc. (NYSE: C), Credit Suisse Group AG (NYSE: CS), Deutsche Bank AG (NYSE: DB), Morgan Stanley (NYSE: MS), Bank of America Corp. (NYSE: BAC), Royal Bank of Scotland Group Plc (NYSE: RBS), BNP Paribas SA (NYSE: BNP), and UBS AG (NYSE: UBS).
Bloomberg notes today that the EU opened a probe in April 2011 to investigate whether or not the banks were giving market information to Markit. The investigation was widened to include ISDA earlier this year.
The investigation was started when CME Group (NYSE: CME) and Deutsche Borse tried to enter the market. The two were unable to acquire CDS exchange-trading licenses from ISDA and Markit per instructions from the banks, according to the EU statement.
The global CDS market is valued at about $10 trillion.
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