7 Feb 2013

RBS fined over Libor rate-fixing scandal

6:41 am on 7 February 2013

The Royal Bank of Scotland has been fined £390m by British and American authorities for its part in the Libor rate-fixing scandal.

Britain's Financial Services Authority issued a fine of £87.5 million, while about £300m will be paid to US regulators and the US Department of Justice.

The fines are £100 million greater than those issued to banking rival Barclays last year for similar offences, the BBC reports.

RBS chairman Sir Philip Hampton said it was a "sad day" for the bank.

British Chancellor George Osborne called the behaviour of traders "totally unacceptable" and said the bank, rather than taxpayers, would be paying the fines.

Junior Treasury minister Greg Clark told parliament that in the case of the US fines, those must be paid from reductions in the bonuses and pay of bank staff.

RBS has been 81% owned by the British government since being bailed out in the 2008 financial crisis.

The bank said that the £300 million owed to US authorities would be paid using money clawed back from bonuses already paid, and reductions to future bonuses.

In 2012, Barclays was fined £290 million, while Swiss bank UBS will pay out £940 million to regulators for its Libor manipulation offences.

RBS said it had uncovered wrongdoing by 21 employees, who had now been disciplined or left the bank.