[THE INVESTOR] The Korea Fair Trade Commission has closed a probe into years-long allegations that six local commercial banks fixed their certificate of deposit rates citing a lack of evidence, the antitrust agency said on July 6.

Six major banks including Shinhan Bank, Kookmin Bank and Woori Bank had allegedly colluded to rig the CD rate to be at a higher level than the market price between 2009 and 2012, while the central bank started to take the expansionary monetary policy in 2012.

The average bank deposit rate fell about 0.3 percentage point between November 2011 and July 2012, but the CD rate dropped 0.01 percentage point over the same period. A higher CD rate than the bank deposit rate brings the banks a larger interest margin.

With growing public complaints in 2012, the FTC began looking into suspected collusion among the financial companies to fix interest rate on CDs.

Four years later, however, the watchdog, in effect, cleared the banks from the allegations, which led many local civic groups to file class action suits against the lenders.

“The FTC decided to close the investigation as evidence is not strong enough to verify the banks’ rate-rigging suspicions,” said the watchdog. “We launched the probe as the banks seemed to have joined hands to freeze the rate, but it was not enough to prove that they actually made antitrust law violations.”

However, the watchdog noted that it can resume the investigation if it finds stronger evidence in the future.


(theinvestor@heraldcorp.com)