South Korea’s antitrust watchdog said Tuesday that it has issued fines worth 59 million won ($49,700) to two foreign banks for rigging bids for foreign currency swap deals.

The Seoul branch of Germany’s Deutsche Bank was fined for 13 million won, while that of HSBC was hit with a fine for 46 million won. 


The two banks were accused of rigging four bidding processes for foreign currency swap transactions that took place between January 2011 and February 2012, according to the Fair Trade Commission.

Deutsche Bank was fined 13 million won, while HSBC was slapped with 46 million won.

A foreign currency swap is a FX derivative that simultaneously trades the same amount of one currency for another with two different value dates. Financial institutions and investors use it to hedge against their foreign exchange positions.

“It is the first time that the FTC caught an offense in foreign exchange derivatives trading,” the watchdog said in a release. “The FTC will tighten monitoring of the financial and foreign currency markets to root out such unfair trading and illegal activities.” (Yonhap)