RBS set for Libor fine of up to £300m

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Royal Bank of Scotland is facing a fine of up to £300m for its role in the Libor rate-fixing scandal.

According to reports, the bank is in advanced negotiations with regulators over the allegations. The fine is expected to be in the region of £200m to £300m, with the 82 per cent state-owned bank set to make the first payment in the next three months.

In June, Barclays was fined £290m for its role in the Libor rate rigging scandal. Chairman Marcus Agius and chief executive Bob Diamond both resigned in the wake of the scandal.

The FT report says “fractures” are appearing between the regulators either side of the Atlantic, meaning the process for those banks facing action will be more drawn out.

RBS has already sacked four traders over the affair and has investigated emails covering the past decade. It is believed to have found similar messages to those found during the investigation into Barclays traders.

In July, RBS chief executive Stephen Hester hinted RBS faced a big fine over Libor.

In an interview with the Guardian, he said: “RBS is one of the banks tied up in Libor. We’ll have our day in that particular spotlight as well.”

He added: “Even though when all the Libor [fines] are out most of it is going to be around the wrongdoings of a handful of people at a number of banks. Those wrongdoings taint a whole industry beyond the handful of people and that makes it a huge problem.”

Also in July, a report by Morgan Stanley said RBS was likely to be one of the banks hit hardest by the Libor scandal. The group said banks’ Libor costs could rise to £14bn for the banking industry.