25 LCR competed contracts for the shorter-dated swaps. For the longer-dated swaps it was decided to appoint one bank without competition because LCR considered the market was less liquid for ultra long dated swaps. LCR was concerned that, had it approached a number of banks to bid for the long dated swaps, it would run the risk of the banks using the knowledge they had gained to take a position in anticipation of the transaction and that this would adversely affect the swap rates available to LCR. Despite this lack of competition, RBC Capital Markets' view is that LCR had reasonably effective processes in place to achieve pricing in line with the market and limit the extent of the swaps banks' profits. RBC Capital Markets considers liquidity often changes and so departments and others considering similar arrangements should investigate market liquidity thoroughly before electing to place any swaps business without a competition.
26 The commission paid to the Lead Managers for the GGB issue was competitive, with fees considerably lower than quoted for comparable deals in the market at the same time. The commission paid to the Lead Managers for the securitisation was in line with the securitisation market at the time.