Competition & Markets Authority
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CMA provisionally finds 5 banks broke competition law on UK bonds

The CMA has provisionally found these banks unlawfully exchanged sensitive information regarding UK government bonds in one-to-one online chats.

The Competition and Markets Authority (CMA) has provisionally found that 5 major banks – Citi, Deutsche Bank, HSBC, Morgan Stanley and Royal Bank of Canada – each unlawfully shared competitively sensitive information by participating in one or more series of one-to-one conversations in chatrooms. The alleged behaviour took place at varying times between 2009 and 2013 (see Table 1).

The information exchanges took place in one-to-one Bloomberg chatrooms between a small number of traders who worked at the banks and related to the buying and selling of UK government bonds – specifically, gilts and gilt asset swaps. This included details on pricing and other aspects of their trading strategies.

The exchanges of information occurred in the context of, some or all of:

  • the sale of gilts by the UK Debt Management Office via auctions on behalf of HM Treasury;
  • the subsequent buying and selling of gilts and gilt asset swaps;
  • buy-back auctions of gilts by the Bank of England (for example, for quantitative easing). The contacts between Deutsche Bank and HSBC did not involve any conduct in relation to buy-back auctions.

By unlawfully exchanging competitively sensitive information rather than fully competing, the banks involved in these arrangements could have denied the full benefits of competition to those they traded with – including, among others, pension funds, the UK Debt Management Office (which sells gilts by auction), and ultimately HM Treasury and UK taxpayers.

Deutsche Bank alerted the CMA to its participation in the alleged unlawful behaviour under the CMA’s leniency policy, and Citi applied for leniency during the CMA’s investigation. Both banks have admitted their involvement in anti-competitive activity and, providing they continue to cooperate and comply with the conditions of leniency, Deutsche Bank will not be fined and any fine that Citi receives will be discounted.

Citi has also entered into a settlement agreement with the CMA and, providing it complies with the terms of settlement, will receive a further discount to any fine imposed.

The CMA’s probe is ongoing and if the CMA reaches a final conclusion that any 2 or more of the banks engaged in anti-competitive activity, the CMA will publish an infringement decision and may issue fines.

Michael Grenfell, Executive Director of Enforcement at the CMA, said:

Our provisional decision has found that, in the aftermath of the global financial crisis, 5 global banks broke competition law by taking part in a series of one-to-one online exchanges of competitively sensitive information on pricing and other aspects of their trading strategies on UK bonds. This could have denied taxpayers, pension savers and financial institutions the benefits of full competition for these products, including the minimisation of borrowing costs.

A properly functioning, competitive bond market benefits tens of millions of taxpayers and pension savers as well as being at the heart of the UK’s reputation as a global financial hub. These alleged activities are therefore very serious and warrant the detailed investigation we have undertaken. While both Deutsche Bank and Citi have admitted their involvement in anti-competitive conduct, we will now consider further representations from the parties before reaching a final decision.

The CMA’s findings are provisional. Deutsche Bank and Citi have admitted to participating in the alleged one-to-one conversations that apply to them. HSBC, Morgan Stanley and Royal Bank of Canada have not admitted any wrongdoing. At this stage, no assumption should be made that any of the banks have broken the law.

More information on this investigation is available on the UK government bonds: suspected anti-competitive arrangements case page.

Notes to editors:

  1. The CMA is investigating suspected anti-competitive arrangements prohibited by the Chapter I prohibition of the Competition Act 1998.

  2. The statement of objections in this case has been addressed to the following entities: Citigroup Global Markets Limited and its ultimate parent company Citigroup Inc. (together ‘Citi’), Deutsche Bank Aktiengesellschaft, HSBC Bank Plc and its ultimate parent company HSBC Holdings Plc (together ‘HSBC’), Morgan Stanley & Co. International Plc and its ultimate parent company Morgan Stanley (together ‘Morgan Stanley’), and RBC Europe Limited and its ultimate parent company Royal Bank of Canada (together ‘Royal Bank of Canada’).

  3. The UK Debt Management Office, the Bank of England and HM Treasury are not under investigation. The UK Debt Management Office, on behalf of HM Treasury, and the Bank of England have assisted the CMA with the investigation by responding to information requests.

  4. Bloomberg chatrooms are a means of electronic communication through which participants can exchange messages. Although the information exchanged through certain Bloomberg chatrooms forms part of the CMA’s investigation, Bloomberg is not under investigation.

  5. A statement of objections gives parties notice of a proposed infringement decision under the competition law prohibitions in the Competition Act 1998. Parties have the opportunity to make representations on the matters set out in the statement of objections. Any such representations will be considered by the CMA before any final decision is made. The final decision is taken by a 3-member case decision group, which is separate from the case investigation team and was not involved in the decision to issue the statement of objections.

  6. Under the CMA’s leniency policy, a business that has been involved in cartel activity may be granted immunity from penalties or a reduction in penalty in return for reporting the cartel activity and assisting the CMA with its investigation. In this case, Deutsche Bank first, and subsequently Citi, reported their involvement in the alleged conduct under the CMA’s leniency policy. Provided they continue to co-operate and comply with the other conditions of the CMA’s leniency policy, Deutsche Bank will benefit from immunity from fines and Citi will benefit from a discount on any fine.

  7. A party under investigation by the CMA may enter into a settlement agreement if it is prepared to admit that it has breached competition law and is willing to pay a fine and agree to a streamlined administrative procedure for the remainder of the investigation. Citi has entered into a settlement agreement with the CMA, as well as applying for leniency. Providing it complies with the terms of settlement, Citi will receive a further discount to any fine imposed.

  8. A gilt is a UK government bond issued by HM Treasury through the UK Debt Management Office (‘DMO’). Gilts are issued to finance the UK government’s cash requirements. That means that individuals and businesses who invest in gilts lend money to the government. In return, the government promises to pay the investors a cash interest payment (the ‘coupon’) up until the gilt’s redemption date (‘maturity’) when the nominal amount invested is paid back to the investor. This case concerns conventional gilts only i.e. gilts with a fixed-rate of interest. Gilts are commonly issued through auction by the DMO to gilt-edged market makers (‘GEMMs’). All 5 banks under investigation by the CMA are GEMMs. Once issued, gilts can be traded up to their redemption date and GEMMs must be ready to buy and sell gilts.

  9. In 2009, in response to the financial crisis, the Bank of England adopted a quantitative easing policy to stimulate the UK economy, part of which involved the Bank of England buying assets, the majority of which were gilts. The Bank of England conducted regular so-called buy-back auctions at certain points during the relevant period to purchase gilts through an asset purchase facility set up as a subsidiary of the Bank of England. It was in the context of some of these buy-back auctions that some of the exchanges of information in question occurred. The alleged one-to-one conversations between Deutsche Bank and HSBC did not involve any conduct in the context of buy-back auctions.

  10. The CMA and the Financial Conduct Authority have concurrent functions to enforce competition law in the financial services sector. It has been agreed (pursuant to regulation 4 of the Competition Act 1998 (Concurrency) Regulations 2014) that the CMA will exercise those functions in relation to this investigation.

  11. For media enquiries contact the CMA press office on 0203 738 6460 or

  12. Anyone who has information about a cartel is encouraged to call the CMA cartels hotline on 0203 738 6888 or email

Figure 1 - Relevant Parties to each of the 5 alleged series of one-to-one conversations

Table 1: Duration of each of the alleged series of one-to-one conversations

Alleged one-to-one conversations Duration
Citi and Deutsche Bank Less than 1 year
Citi and Morgan Stanley Less than 1 year
Deutsche Bank and HSBC Less than 1 year
Deutsche Bank and Morgan Stanley More than 1 year
Deutsche Bank and Royal Bank of Canada More than 3 years
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