RBS could be fined $783 million in interest rate case
LONDON — Royal Bank of Scotland is poised to be fined between $625 million and $783 million for manipulating interest rates, the second-biggest penalty imposed in a global probe by regulators, two people with knowledge of the matter said.
An announcement may be made as soon as Wednesday, said the people, who requested anonymity because they weren't authorized to speak publicly. An RBS unit will plead guilty to criminal charges as part of a deal with the U.S. Justice Department, a person familiar with the talks said. It's the third fine to result from a probe into whether lenders rigged the London interbank offered rate, or Libor.
Investment banking chief John Hourican is expected to resign, the people said.
The Scottish bank owns RBS Citizens Financial Group, the parent of RBS Citizens Bank of Pennsylvania. RBS Citizens created the Pennsylvania bank from its 2001 acquisition of the former Mellon Financial Corp.'s retail bank franchise.
The penalty is the biggest blow to Chief Executive Officer Stephen Hester's attempt to overhaul the Edinburgh-based bank after it took a 2008 taxpayer bailout. The fine would exceed the one Barclays Plc paid in June, and be second only to the $1.5 billion UBS AG paid in December. Chancellor of the Exchequer George Osborne said this week that RBS should pay the U.S. fines by clawing back bonuses from its investment bankers.
No individuals will be criminally charged as the Justice Department announces its settlement with the bank, according to two people with direct knowledge of the matter.
RBS may pare the bonus pool at its investment bank by more than a third, a person with knowledge of the plan said last month.
Show commenting policy
TribLive commenting policy
- Pakistan allows gathering of 1,000 Taliban amid leadership rift
- Dozens of Venezuelans shot by police amid crime crackdown
- China’s WWII parade of military might stirs up Taiwan, others in Asia
- Officer killed in Ukraine clash with nationalist protesters
- European Union struggles for answers as migrant influx raises tensions
- Attack underlines train vulnerabilities
- Corpses in truck on Austrian road thought to be smuggled refugees
- Vatican priest accused of child sex abuse found dead
- Migrant crisis forces European Union leaders to set summit
- Temple in ancient Syrian city of Palmyra bombed by ISIS terrorists