Danish police are looking into how Danske Bank A/S’s bonus program might have influenced employees now being investigated for alleged bond price manipulation.
The Public Prosecutor for Serious Economic and International Crime, which on Feb. 7 accused Danske, six of its employees and its home-loan unit of rigging mortgage bond prices in 2009, needs to find out what role the prospect of a bigger paycheck played, Public Prosecutor Hans Fogtdal said Feb. 17 in a telephone interview.
The alleged misdeeds were designed to drive mortgage bond prices higher, making client redemptions more costly, according to the public prosecutor. The trades in question date back to some of the darkest hours of the global financial crisis, after the 2008 failure of Lehman Brothers Holding Inc. The case raises questions as to how widespread price fixing was, lawmakers said last week.
How banks reward their employees has come under greater scrutiny as the gap between financial industry pay and salaries earned elsewhere widens.
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Schaeuble Sees Step-by-Step Introduction of Transaction Tax
The introduction of the financial-transaction tax is to start with shares, German Finance Minister Wolfgang Schaeuble told reporters after a meeting of European Union finance ministers in Brussels.
He said it is “not decided’ if the financial-transaction tax will start with derivatives.
Eurogroup chairman Jeroen Dijsselbloem said there are ‘‘very different’’ opinions on the financial transaction tax among the group of countries that attended the meeting.
Eleven states working together on a tax under the so-called system of enhanced cooperation met in Brussels yesterday.
Over 30,000 Yorkshire Building Clients to Be Refunded, FCA Says
Yorkshire Building Society, the U.K. provider of financial services, will provide refunds to more than 30,000 clients, according to the Financial Conduct Authority.
The company will refund all administration fees for mortgage arrears since January, 2009, after the authority found that some customers were charged incorrectly, the regulator said.
The Building Society is expected to pay 8.4 million pounds ($14 million) in total to about 33,900 current and former customers, according to the regulator.
The company’s procedures weren’t ‘‘robust enough,” the authority said.
Nigeria’s Central Bank to Meet With Lenders on FX Trading
The Central Bank of Nigeria will meet with lenders tomorrow to “deliberate on recent developments in the foreign-exchange market,” the Abuja-based bank said in a notice on its website.
The central bank said last week that it has adequate reserves to keep defending the naira as the slumping currency prompted a selloff of the country’s stocks. Central Bank Deputy Governor Sarah Alad, speaking from Lagos Feb. 14, said the bank will intervene whenever there is need to.
Noonan Says EU Must Consider Backstop for SRM as Fund Is Small
Irish Finance Minister Michael Noonan said the European Union, “in the interests of credibility,” must consider a backstop for the proposed Single Resolution Mechanism for euro-area banks because the planned fund for covering resolution costs is of limited size.
Noonan made the remarks in Brussels yesterday during a meeting of EU finance ministers.
“Maybe if we could bring forward the date of consideration of the backstop, or if we had an agreement that a backstop would be in place by a certain date, that might help the credibility of the system.”
European Central Bank Vice President Vitor Constancio said the common fund attached to a proposed Single Resolution Mechanism should be able to borrow if necessary.
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