Standard Bank denies manipulating the rand
Standard Bank issued a statement Friday night strongly denying allegations that it manipulated the rand or engaged in anti-competitive or criminal conduct.
The statement comes after reports last week that Standard Chartered Bank had been fined R43 million for manipulating the rand against the US dollar.
The UK-based multinational bank pleaded guilty to using illegal tactics to manipulate the rand between 2007 and 2013.
It should be noted that Standard Chartered and Standard Bank are separate entities. Standard Chartered sold its stake in Standard Bank in 1987.
“Standard Bank has noted with serious concern false and inaccurate comments in some media and social media related to the Competition Commission investigation into currency manipulation,” the bank stated.
“These comments incorrectly link various unrelated and unfounded allegations with the Competition Commission inquiry currently under adjudication before the Competition Appeal Court, in South Africa.”
Standard Bank is referring to a case before South Africa’s competition watchdog where 28 banks stand accused of colluding on foreign exchange prices.
The Competition Commission found that, from at least 2007, the banks had a general agreement to collude on prices.
This included prices on bids, offers, and bid-offer spreads for the spot trades in relation to currency trading involving the rand/dollar currency pair.
The commission referred the case to the Competition Tribunal, which dismissed all the various applications and objections brought by the accused banks.
“We take this opportunity to re-iterate Standard Bank’s position,” the bank’s statement continued.
“Standard Bank has not manipulated the value of the rand. Standard Bank has not engaged in any anti-competitive or criminal conduct. All such claims are false,” Africa’s biggest lender by assets said.
“Standard Bank said it would continue to use every avenue provided to it in law to defend itself against these false allegations.”
Standard Bank said it is committed to behaving with complete integrity and positively contributing to the societies in which it works.
“Standard Bank’s long-run performance depends on the success of the economy and on the economic wellbeing of our clients,” it said.
“Standard Bank is wholly committed to the rule of law, respects the important role of institutions, and upholds South Africa’s Constitutional democracy, and our Constitutional obligation to ensure that our country improves the quality of life of all citizens.”
The bank said it is a leading advocate of the investment case for South Africa.
“We have consistently stood with the government, organised labour, organised business and civil society in promoting inclusive growth and sustainable development in South Africa,” it said.
“Assertions that Standard Bank is not supportive of the interests of our customers, of South Africa’s economy and society and of the Constitution of South Africa are not consistent with how Standard Bank conducts itself.”
TreasuryOne director and currency risk strategist Andre Cilliers recently told Kaya Biz that although the banks should not be exonerated of wrongdoing, South Africans must be realistic about the impact of the collusion.
Cilliers said that manipulating the rand made significant profits for the banks and companies involved. However, claims that they profited R1 trillion a day and impacted the currency’s long-term value are exaggerated.
He explained that the most likely purpose of the alleged manipulation was to favour the banks during significant transactions, such as mergers, acquisitions, large export deals, or capital transactions.
This price-fixing can only happen over a short period.
“There’s no way that you can manipulate the currency where fundamentals like economic growth, inflation rates, job creation, unemployment numbers, and all these things come into play. You cannot manipulate all of that,” he said.
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