RBS to get Libor punishment next week - sources

LONDON Fri Feb 1, 2013 5:20pm GMT

A flag flies over the former headquarters and registered office of the Royal Bank of Scotland (RBS) in Edinburgh, Scotland March 29, 2012. REUTERS/David Moir

A flag flies over the former headquarters and registered office of the Royal Bank of Scotland (RBS) in Edinburgh, Scotland March 29, 2012.

Credit: Reuters/David Moir

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LONDON (Reuters) - Royal Bank of Scotland will next week agree a settlement with U.S. and British authorities for its part in a global rate rigging scandal, sources familiar with the situation told Reuters.

The bank is expected to be fined between 400 and 500 million pounds for the attempted rigging of the London interbank offered rate (Libor) and other benchmark interest rates. Details of the punishments will be revealed on Tuesday or Wednesday, the sources said.

RBS and the UK's Financial Services Authority (FSA) declined to comment.

RBS, which is 81 percent owned by the British taxpayer, will be the third bank after Barclays and UBS to settle with regulators investigating the affair.

RBS's punishment will be greater than the $450 million fines paid by UK rival Barclays, but well short of the record $1.5 billion fines handed out to Switzerland's UBS.

More than a dozen banks around the world have been scrutinized by regulators as part of an investigation into the suspected rigging of interbank rates, which are used to price trillions of dollars of financial instruments.

RBS hopes to save over 100 million pounds to help pay the fines by slashing bonuses for its investment bankers, a source familiar with the situation told Reuters in January.

The bank is also expected to part company with John Hourican, head of RBS's investment bank, at the time of the settlement.

(Editing by Sinead Cruise and David Holmes)

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Comments (2)
Wrywriter wrote:
RBS should not only part company with a number of staff but should also prosecute a few. What were the regulatory officers and the internal auditors doing – asleep at the wheel? They should be sacked! No sign of the Serious Fraud Office – come on this has to be a really serious fraud!!!

Feb 01, 2013 6:17pm GMT  --  Report as abuse
farmerrobin wrote:
hourican will, no doubt, get a substantial golden goodbye; when, in fact, the whole board, by default, should be in front of a judge for allowing their company to commit fraud, they are either in charge & thus responsible or they’re not and so why is the taxpayer paying their salaries

Feb 01, 2013 8:35pm GMT  --  Report as abuse
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