The court action initiated by the Australian Securities and Investments Commission against three of the Big Four banks over allegations of interest rate manipulation has been recalibrated to target Westpac alone, after ASIC extracted last-minute settlements from ANZ and NAB. Allegations of profiteering in the bank bill market in recent years levelled at Westpac - and said to be exemplified by a haul of A$12 million on a single day - are refuted by "two pieces of objective evidence," along with an appreciation for "managing … interest rate risk," the Federal Court heard yesterday.On the third day of a civil trial that pitches the corporate regulator, ASIC, against the bank in a revealing contest, Westpac's counsel Matthew Darke urged the court: "Understanding the context in which the trading took place is critical."Darke supplied a rival, if elaborate, explanation for the trading on the morning of Tuesday 6 April 2010, a day when the Reserve Bank was due to announce its monthly decision on monetary policy and Westpac had a A$14 billion position."Purchasing prime bank bills in volume would be the most obvious mechanism to reduce some of that exposure [to the unknown of the decision on the cash rate]," Darke said.One of the key players to emerge so far has been Colin Roden, the executive director and later managing director of portfolio management within group treasury at the bank. His spicy phone conversations with Westpac treasury trader Sophie Johnson added to the drama of the proceedings on Tuesday.Darke drew on Roden's expertise again yesterday. In an affidavit prepared by Westpac's legal team, Roden  characterised buying bank bills in that manner as "a standard risk management technique," while also analysing off-market trades in Commonwealth Bank paper and purchases of bills that morning in one, two and three month tenors.Darke explained that "if Roden's dominant purpose for trading on this day was to get one month BBSW down" - as ASIC contended - "he wouldn't have bought the bills off market, he would have bought them on market."Purchases of two-month bills that day is a "critically important piece of context that comes out of the trading in the rate set window."The hearing resumes next Wednesday in the Federal Court in Melbourne.