Bank cartel case claims high-profile scalp at ASX

Written on the 19 June 2018 by Nick Nichols

Bank cartel case claims high-profile scalp at ASX

The cartel scandal that has rocked the Australian banking industry has claimed another scalp with the resignation of former JP Morgan Australia CEO Robert Priestley from the board of ASX Ltd (ASX:ASX).

The move comes less than two weeks after ASX expressed confidence in Priestley who was head of the investment giant's Australian arm when it underwrote a $2.5 billion capital raising in 2015 for ANZ that is the subject of the cartel allegations brought by the ACCC.

ASX says Priestley's resignation as non-executive director is effective immediately.

In a statement to the Australian Securities Exchange, Priestley blames his departure on the 'potential distraction' around the ACCC's plans to launch criminal charges alleging cartel activity by ANZ, Citigroup and Deutsche Bank in relation to the capital raising.

"I am very conscious of the unique role that the ASX plays at the heart of Australia's financial marketplace, and with all of its participants," he says in the statement.

"There has been considerable interest in the ACCC banking matter which may become a potential distraction for the ASX and my board colleagues.

"It is likely that this matter will take some time to resolve, and as there are limits to the information that can be discussed at this time, I think the right course of action in these circumstances is to step aside from the ASX board to allow the situation to be fully resolved.

"I look forward to the time when all of the facts and circumstances relevant to this matter are clarified."

Priestley joined the ASX board in May last year. He stepped down as CEO of JP Morgan Australia at the same time after 15 years in the role.

The ACCC rocked the investment banking industry this month with news that it planned to launch a criminal prosecution against one of Australia's largest banks.

JP Morgan has been granted immunity from prosecution for co-operating with prosecutors.

If proven, the charges carry penalties of up to 10 years in prison and fines of up to $420,000 for executives involved.

Earlier this month, ASX is reported to have thrown its support behind Priestley with a spokesman describing him as a 'highly valued member of the board'.

In a statement this morning, ASX chairman Rick Holliday-Smith lauded Priestley's decision to resign from the board.

"Rob's decision to step down in these circumstances demonstrates his commitment to the highest standards of corporate governance," he says.

"We understand the difficulty of his position and appreciate that he has made a decision that puts ASX ahead of other considerations.

"Rob has been a valued member of the ASX board and we look forward to this matter being resolved."

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Author: Nick Nichols

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