South Korea‘s antitrust watchdog said Sunday that it has fined four foreign banks 693 million won ($618,000) for fixing the prices of foreign exchange derivatives and selling them to five South Korean companies.
The Fair Trade Commission said Standard Chartered Bank Korea and the local units of Deutsche Bank AG, JPMorgan Chase & Co. and HSBC agreed on prices of foreign exchange derivatives on seven occasions between March 2010 and February 2012.
|Standard Chartered Bank Korea`s head branch in central Seoul (Yonhap)|
Deutsche Bank, JPMorgan Chase & Co. and HSBC sold yen/won cross currency swaps each worth 10 billion yen (US$91.4 million) at either the same or similar prices to an unidentified South Korean firm on May 4, 2010.
The commission also said Deutsche Bank and HSBC sold US dollar/won forwards worth $64 million and $60 million, respectively, to another South Korean company on Nov. 4, 2011.
The banks’ actions were meant to eliminate competition among themselves and raise the prices of foreign exchange derivatives.
Meanwhile, Deutsche Bank offered its foreign exchange swaps and foreign exchange forwards at either a similar price to those of HSBC and Standard Chartered Bank Korea or an unfavorable price to make sure the two banks sold their products.
The commission fined Deutsche Bank 212 million won, JPMorgan Chase & Co. 251 million won, HSBC 225 million won and Standard Chartered Bank Korea 5 million won.
The commission said the banks‘ actions increased costs for their clients and undermined competition in the markets.
HSBC offered an apology and said it is in touch with the companies whose transactions were involved.
“HSBC does not tolerate behavior that does not live up to its values,” HSBC Seoul Branch said in a statement. “HSBC takes the conduct of staff extremely seriously and is committed to taking whatever action is necessary to ensure fair outcomes for all clients.”
Standard Chartered Bank Korea, Deutsche Bank and JPMorgan Chase & Co. all declined to comment. (Yonhap)