Forex rigging scandal: How the FCA fines have hit RBS, HSBC, Bank of America, JP Morgan, Citi and UBS

RBS is the most apologetic of the banks, in part because it is 81 per cent taxpayer owned, and in part because its chief executive joined after the wrongdoing. “To say I’m angry about this misconduct would be an understatement,” chief Ross McEwan said yesterday. “We’ve had people working in this bank who didn’t know the difference between right and wrong, or worse, didn’t care about the distinction.” RBS shares fell 0.95 per cent yesterday.

 

HSBC is understood to be in talks with other regulators about forex, beyond the FCA and CFTC. “HSBC does not tolerate improper conduct and will take whatever action is appropriate,” said a spokesperson for the bank. The bank has faced a spate of other bills, including fines for poor anti-money laundering controls. As a result it has hired a series of big-name ex-regulators to improve its compliance operations. Its shares dipped 0.3 per cent.

 

Bank of America suffered the worst regulatory costs of the year, paying $17bn in a wide-ranging mortgage settlement, which included compensation payments to customers of banks which it rescued in the financial crisis. Yesterday, it was hit with the smallest charge, $250m, levied by another US regulator called the Office of the Comptroller of the Currency. It did not receive any fines from either the FCA or the CFTC. Its shares fell 0.17 per cent yesterday.

 

US banking giant Citi has been hit by a range of legal cases in recent years, including a $7bn mortgage market settlement and Libor fines. “Citi acted quickly upon becoming aware of issues in our foreign exchange business and we have already made changes to our systems, controls and monitoring processes to better guard against improper behaviour,” Citi said. Its shares fell 0.72 per cent.

 

JP Morgan was one of the five banks fined by both the UK’s FCA and the US’ CFTC. “The trader conduct described in today’s settlements is unacceptable,” a spokesperson said. “In addition to making significant improvements to our systems and controls, we have spent a lot of time reinforcing the high standards of conduct expected of our people.” JP Morgan’s shares slid 1.3 per cent.

 

UBS took the most fines yesterday, as Swiss regulator Finma also took action against the bank – its settlements totalled £505m. The bank has taken more radical action than most to cut down its investment banking arm, focusing instead in areas like wealth management. Its shares were flat on the day.