The ANZ Group Holdings Ltd (ASX: ANZ) share price has climbed 2.08% so far this week, compared to a rise of 0.87% for the S&P/ASX 200 Index (ASX: XJO).
It's curious that the ASX bank share has noticeably outperformed the index this week, considering the market learned about the latest chapter of the fallout of ANZ's bond scandal.
As my colleague Mitchell Lawler first reported in July, the Australian Securities and Investment Commission (ASIC) is investigating whether ANZ manipulated the market in a $14 billion bond deal that it handled for the Australian Federal Government.
This alleged market manipulation may have cost Aussie taxpayers tens of millions of dollars because ANZ increased the cost of the government's borrowing.
Image source: Getty Images
ASIC raids
According to reporting by the Australian Financial Review this week, federal police officers raided four properties on 13 August. Those officers were working with ASIC to gather evidence about the bank and the ANZ traders involved.
The ASIC probe, which started in February, has seen the watchdog request almost 1 million documents and communication records, while also interviewing traders and risk and compliance officers.
The AFR noted that no charges had been laid so far. According to the newspaper, ANZ is conducting its own international investigation, and three trading staff members have departed.
The newspaper also reported that while ANZ CEO Shayne Elliott has made assurances that the bank and its management would "take complete responsibility for any misconduct found", he has also said to staff that ANZ was a complex business where "things occasionally go wrong".
ASIC chair Joe Longo previously said to the AFR:
It's a matter for the CEO of ANZ how he wants to characterise it, but it's on the public record that it is an investigation, which means by definition we suspect a contravention of the law.
Damage to ANZ's reputation and financials
Not only is the investigation harming ANZ's reputation, but it's also impacting the bank's financials.
The Australian Office of Financial Management (AOFM) has reportedly excluded ANZ from two debt sales totalling $15 billion. That included a $7 billion green bond, the first ever issued by the Treasury.
While ANZ wasn't part of that debt sale, the other major ASX banks — Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB) — were involved.
ANZ share price snapshot
Despite setbacks related to the ASIC investigation, however, the ANZ share price has lifted more than 16% this year as we can see in the chart below.
