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RBS to settle Libor allegations

The Royal Bank of Scotland said last week that it plans to pay a fine in order to settle claims by regulators that it tried to manipulate Libor.

RBS CEO Stephen Hester said that even if the fine is not greater than the record $467 million issued to Barclays in June, “it will still be a miserable day in RBS’s history.”

“It is a deeply regrettable thing…” Hester said, according to Reuters. “This is the sort of thing the industry has to put behind it.”

RBS is just one of several banks under investigation by international regulators for attempted manipulation of Libor, a key benchmark rate used to price more than $300 trillion of securities.

RBS fired at least four traders following an internal investigation and suspended the head of rates trading for Europe and the Asia-Pacific area as a result of the manipulation.

Hester said that he expects details related to a settlement to emerge by next February, adding that the bank is “up for settling with all and everyone as soon as they are ready,” Reuters reports.

Libor is the biggest regulatory obstacle facing Hester as he attempts to overhaul the bank after it received the largest bailout in history in 2008. The bank announced last week that it would set aside $639 million to compensate clients negatively affected by the bank’s actions, according to Businessweek.

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