22 Jun 2015

FMA, ASB Bank reach swap settlement

2:55 pm on 22 June 2015

The Financial Markets Authority (FMA) has reached a settlement with the ASB Bank regarding the sale, promotion and marketing of interest rate swaps to some rural customers.

The Commerce Commission reached a separate agreement with the bank late last year, in which ASB made $2.7 million available for payments to eligible customers.

The bank did not accept the conclusions of the Commerce Commission but admitted some of its conduct breached fair trading rules in respect of some of its customers.

ASB has also agreed to pay $250,000 towards the Commission's costs and another $250,000 to the Dairy Women's Network.

The bank has agreed to appoint an independent third party to review business practices related to interest rate swaps and term funds, as part of its settlement with the Financial Markets Authority (FMA).

The FMA has already settled with Westpac and ANZ bank.

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