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Libor scandal: RBS fined £390m Libor scandal: RBS fined £390m
(35 minutes later)
Royal Bank of Scotland (RBS) has been fined £390m ($610m) by UK and US authorities for its part in the Libor rate-fixing scandal.Royal Bank of Scotland (RBS) has been fined £390m ($610m) by UK and US authorities for its part in the Libor rate-fixing scandal.
The UK's Financial Services Authority issued a fine of £87.5m, while about £300m will be paid to US regulators and the US Department of Justice.The UK's Financial Services Authority issued a fine of £87.5m, while about £300m will be paid to US regulators and the US Department of Justice.
In a statement, the bank said investigations had uncovered wrongdoing by 21 employees. The bank said wrongdoing had been uncovered by 21 employees, who had now been disciplined or left the bank.
All 21 have either left or been disciplined, it said. Chairman Sir Philip Hampton said it was a "sad day for RBS".
RBS is the third major bank to admit attempting to manipulate Libor.
Last year Barclays and Swiss bank UBS were also fined by regulators for similar failings.
RBS said that £300m of the fines would be paid using money clawed back from bonuses already paid, and reductions to future bonuses.RBS said that £300m of the fines would be paid using money clawed back from bonuses already paid, and reductions to future bonuses.
It is the third major bank to admit attempting to manipulate Libor, after Barclays and Swiss bank UBS received fines last year.
Chairman Philip Hampton said it was a "sad day for RBS".
'Widespread misconduct''Widespread misconduct'
"There were serious shortcomings in our systems and controls and also in the integrity of a small group of our employees," he said in a statement. "There were serious shortcomings in our systems and controls and also in the integrity of a small group of our employees," Sir Philip said in a statement.
"We have to fix the culture in the banking industry... the board has used all means possible to ensure the gravity of this issue is reflected in the remuneration received by employees.""We have to fix the culture in the banking industry... the board has used all means possible to ensure the gravity of this issue is reflected in the remuneration received by employees."
Crisis jargon buster Use the dropdown for easy-to-understand explanations of key financial terms:
AAA-rating The best credit rating that can be given to a borrower's debts, indicating that the risk of borrowing defaulting is minuscule. Glossary in full		 Crisis jargon buster Use the dropdown for easy-to-understand explanations of key financial terms:
AAA-rating The best credit rating that can be given to a borrower's debts, indicating that the risk of borrowing defaulting is minuscule. Glossary in full
The FSA said the misconduct at RBS was "widespread" and had involved "a number of employees and occurred over a number of years". The FSA revealed that the bank qualified for a 30% discount on its fine because it agreed to settle at an early stage of the investigation. Without the discount the fine would have been £125m.
It revealed that the bank qualified for a 30% discount on its fine because it agreed to settle at an early stage of the investigation. Without the discount the fine would have been £125m. It said the misconduct at RBS was "widespread" and had involved "a number of employees and occurred over a number of years".
RBS's Japanese subsidiary has pleaded guilty to one count of wire fraud relating to the manipulation as part of the settlement with US regulators.RBS's Japanese subsidiary has pleaded guilty to one count of wire fraud relating to the manipulation as part of the settlement with US regulators.
The bank has entered into a deferred prosecution agreement with the US Department of Justice on other charges.The bank has entered into a deferred prosecution agreement with the US Department of Justice on other charges.
The head of RBS's investment banking arm, John Hourican, will also leave the bank, it has been confirmed.The head of RBS's investment banking arm, John Hourican, will also leave the bank, it has been confirmed.