The ANZ Bank has decided to pay up over alleged manipulation of interest rates

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The ANZ Bank says it has a confidential in-principle agreement with ASIC (Australian Securities and Investments Commission) to settle court action relating to alleged manipulation of the Australian interbank bank bill swap rate (BBSW).

Federal Court proceedings against the bank have been put on hold for 48 hours while ASIC and the ANZ finalise details of the deal.

In a statement the ANZ did not give further details, including any financial penalty.

However, the bank did say the financial impact will be reflected in the 2017 financial year results due to be released this week.

And the amount is “largely” covered by provisioning, the bank said.

The ANZ’s 2016 annual report mentions the BBSW court action as a contingent liability but doesn’t put a number to the action.

The bank then reported: “The potential civil penalty or other financial impact is uncertain.”

The Australian Financial Review reports that the last-minute deal with the corporate regulator means the ANZ will pay more than $50 million to settle the case.

ASIC launched court proceedings in March 2016 alleging market manipulation, unconscionable conduct, misleading or deceptive conduct between March 2010 and May 2012.

NAB and Westpac are also caught up in the allegations of rigging the BBSW, a key interest determining the pricing of billions of dollars of loans across the economy.

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