ANZ breached disclosure laws in $3b capital raising
ANZ breached its continuous disclosure obligations when it did not disclose that underwriters had filled a $790 million shortfall when raising $2.5 billion from institutional investors in 2015, a court has found.
Federal Court Justice Mark Moshinsky on Friday said the information was material to ANZ’s share price and could have caused shareholders to either dispose of or buy shares in the banking giant.
“The court has concluded that ANZ breached its continuous disclosure obligations,” he said.
ASIC claimed ANZ should have told shareholders because the shortfall was both “significant” and had the potential to put downward pressure on its share price. Will Willitts
The decision is a massive win for the Australian Securities and Investments Commission, which first brought the case to court in 2018. Justice Moshinsky said a hearing to determine the fine levied against ANZ would be set later.
Justice Moshinsky said ANZ’s arguments that the information was not material and was broadly known in the market, despite the bank not informing investors of the shortfall, were false.
“The matters provided by ANZ do not fully or accurately reflect the facts and others do not reflect the meaning of material,” he said.
ANZ acknowledged the decision and said, based on the penalty regime at the time of the capital raising, it would only face a $1 million fine at most.
“ANZ is reviewing the judgment,” it told investors in an ASX statement.
ASIC deputy chairman Karen Chester said disclosure was critical to a functioning financial market.
“In the context of capital raising transactions, ASIC expects that issuers will consider the information in their possession and make appropriate disclosures to the market – particularly here where the
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