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    ANZ admits to bond trading misconduct, resulting in AUD 240 million penalties from the Australian regulator

    by VT Markets
    /
    Sep 14, 2025
    Australia’s ANZ Group, one of the country’s top four banks, has admitted to wrongdoing in its bond trading services. The bank will pay AUD240 million in penalties as part of a settlement with the Australian Securities and Investments Commission (ASIC). The issues included market manipulation during the issuance of government bonds and mistakes in reporting bond trading data.

    Implied Volatility

    We expect a significant rise in the implied volatility of ANZ options in the next few days. The implied volatility for short-term ANZ options has already surged to over 30%, similar to the stress the banking sector faced in early 2023. This indicates that traders may look to use strategies that benefit from price changes, such as buying puts to protect against further damage to ANZ’s reputation. The news will also change how the market assesses ANZ’s credit risk. We are already seeing the cost of ANZ’s 5-year credit default swaps (CDS) increase by 8 basis points to 62 bps, which indicates a higher cost to insure against the bank’s debt. Traders may want to buy CDS protection for ANZ or a group of Australian banks as a safeguard against potential wider issues.

    Regulatory Scrutiny on Banking Sector

    This situation puts the entire Australian banking sector under closer watch. Increased scrutiny from ASIC could cause more uncertainty, affecting the S&P/ASX 200 Financials Index (XFJ). We should be on the lookout for higher trading volume and volatility in options and futures related to this index. Since the violations happened in bond trading, it is important to keep an eye on liquidity in Australian Government Bond (AGB) futures. The market’s trust has been weakened, which could result in wider bid-ask spreads for 3-year and 10-year AGB futures contracts. Any signs of lower liquidity could create short-term trading opportunities for those who are well-prepared. Create your live VT Markets account and start trading now.

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