Economy
Lloyds Libor-rigging scandal settlement reaches late stage
Lloyds Banking Group (LBG) is about to reach final settlements with UK and US financial regulators over the Libor-rigging scandal, with the bank expected to face fines of up to £300 million.
The bank, partly owned by the government, would be the seventh UK bank to be fined by regulators over the manipulation of the London interbank offered rate (Libor) scandal, where banks inflated and deflated their rates to profit from trades.
The Royal Bank of Scotland (RBS) faced a £390 million fine from regulators in relation to the scandal, with Barclays also fined around £290 million. It is believed that a similar penalty will be inflicted to Lloyds.
Dutch bank Rabobank, Swiss bank UBS and money brokers Icap and RP Martin were also sanctioned, with the first two fined £637 million and £940 million respectively.
The group confirmed in a statement that the settlement has reached its final stage.
“Lloyds Banking Group notes the recent media coverage regarding potential settlements with a number of government agencies and their investigations into submissions, communications and procedures around the setting of Interbank Offered Rates and other benchmarks”, it said.
“LBG confirms that it is in late-stage settlement discussions with a number of agencies. The settlements remain to be agreed and LBG expects they will include the payment of penalties. LBG will update the market on these issues as appropriate”
Lloyds will have to pay fines to the Commodity Futures Trading Commission and Department of Justice in the US and the Financial Conduct Authority in the UK.
Photo: Elliott Brown via Flickr
Further reading:
RBS targets bankers’ bonuses to pay off imminent Libor fine
Six more traders face criminal charges for Libor rigging
Bob Diamond among Barclays exec called to give evidence in Libor trail