RBS agrees £391m rate-fixing fine

RBS agrees settlement over the rate-rigging scandal

RBS agrees settlement over the rate-rigging scandal

First published in National News © by

Taxpayer-backed Royal Bank of Scotland (RBS) has agreed a £391 million settlement with US and UK regulators as it became the third banking giant to admit its part in the rate-rigging scandal.

RBS, which is 81% owned by the Government, will recoup around £300 million from its staff bonus pool and by clawing back previous awards, and said investment banking boss John Hourican will step down, forfeiting his 2012 bonus and long-term incentive shares.

Under its settlement, RBS has also agreed a deferred prosecution agreement with the US Department of Justice (DoJ) - a deal that could see it face tough sanctions if it commits any form of criminal offence during the period - while its Japanese arm has pleaded guilty to wire fraud.

RBS said 21 staff were involved in attempting to manipulate interbank lending rates - specifically Japanese Yen and Swiss Franc Libor submissions - from October 2006 to as recently as November 2010.

All 21 have left or been subject to disciplinary action and two managers with supervisory responsibilities have stepped down.

Six staff have been dismissed, including two managers, while six have been severely disciplined or are going through a disciplinary process.

Another eight left the organisation before disciplinary action could be taken and one was dismissed for misconduct not related to these findings, added RBS.

All staff that have left the bank as a result of the investigation received no bonus for 2012 and saw full claw-back of any outstanding past awards.

Mr Hourican leaves with 12 months pay worth £775,000, but will forfeit £9 million in bonuses for last year and clawed-back previous awards.

Sir Philip Hampton, chairman of RBS, said it was a "sad day for RBS", but vowed to "put right the mistakes of the past".

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