The Disciplinary Committee of NASDAQ OMX has decided to order Danske Bank to pay a fine of SEK 500,000. At the same time, a trader employed by Danske Bank has been issued with a warning.
In accordance with the NASDAQ OMX Nordic Member Rules (NMR), Section 4.6.1., orders registered in the trading system must be genuine orders. In Section 4.6.2 of NMR, it is stipulated that a member may not place orders or complete transactions that are intended to improperly influence price formation in the trading system or that are devoid of a commercial purpose. In the case in question, the Disciplinary Committee has found that Danske Bank has breached these regulations.
The Trading Surveillance function at NASDAQ OMX Stockholm noted a trading pattern that deviated from normally occurring trading in the shares of Astra Zeneca, AZN. Danske Bank had repeatedly placed orders pertaining to very large blocks of shares in AZN, orders that were canceled after a few seconds, at the same time as the bank had placed smaller orders on the opposite side of the order book. The smaller orders remained in place for longer periods of time and resulted in trades. On the whole, the trading pattern indicated that there was no intention that the orders registered would result in a trade, and that they had instead been designed during brief periods to send signals to other market participants of an increased supply of, or demand for, AZN shares.
Danske Bank has claimed that the orders were genuine and intended to lead to trades.
The Committee has taken into account the fact that it has never addressed a completely similar case and also assumes that neither Danske Bank nor the trader had realized that the trading pattern that had been applied might have been prohibited and also takes into account the fact that no previous warning had been issued. The Committee also notes that immediately after the disciplinary matter had been initiated, Danske Bank explained that the trading pattern in question would cease in all respects. The Disciplinary Committee has therefore decided to impose a fine at the lower end of the scale. The sanction for the authorized trader involved in the matter has been set at a warning.