Partly Cloudy

Partly Cloudy

max temp: 20°C

min temp: 14°C

ESTD 1874 Search

UK: UBS agrees £940m Libor rigging settlement

08:43 19 December 2012

The UBS offices in the city of London

The UBS offices in the city of London

SWISS bank UBS today agreed to pay £940million to regulators in the biggest penalty yet from the industry’s Libor rate-rigging scandal.

shares

The settlement, which includes a record fine of £160m from the UK’s regulator, the Financial Services Authority, is far larger than the total of £290m paid by Barclays for Libor manipulation this summer.

The FSA said the misconduct at UBS was “extensive and widespread”, with at least 45 individuals including traders, managers and senior managers either involved in, or aware of, the practice.

As well settling with the FSA, UBS has also agreed to pay 1.2billion US dollars (£740m) in fines to the US Department of Justice and the Commodities Futures Trading Commission, and 59m Swiss francs (£40m) to the Swiss Financial Market Supervisory Authority.

UBS said the fines were likely to see it report a loss of between 2bn to 2.5bn Swiss francs (£1.3bn to £1.7bn) for the fourth quarter of 2012.

Sergio Ermotti, chief executive of UBS, said the group had “taken decisive and appropriate actions” following the probe.

He added: “We deeply regret this inappropriate and unethical behaviour. No amount of profit is more important than the reputation of this firm, and we are committed to doing business with integrity.”

Zurich-based UBS, which has around 6,500 staff in London, has endured a turbulent year after the jailing of rogue trader Kweku Adoboli.

Libor is an umbrella term for the benchmark inter-bank lending rates which underpin the wider lending market.

The FSA said misconduct at UBS was “all the more serious” as it had attempted to manipulate Libor submissions at other banks, making corrupt payments to reward brokers for their efforts.

Today’s report from the FSA revealed incriminating conversations between UBS traders and brokers, saying they would “play the rules” and “return the favour”.

One trader said: “I need you to keep it (the six-month Japanese Libor rate) as low as possible... if you do that... I’ll pay you, you know, 50,000 dollars, 100,000 dollars... whatever you want... I’m a man of my word.”

Bankers referred to each other in congratulatory terms, such as “the three muscateers (sic)”, “Superman”, and “Captain caos (sic)”, according to the FSA.

The Libor rigging probe, which has embroiled about 20 financial institutions, has accelerated with the first arrests by the Serious Fraud Office taking place last week.

Taxpayer-backed Royal Bank of Scotland has previously said it hopes to settle any claims over Libor manipulation soon and warned that potential penalties could be significant.

shares

0 comments

Post Office services to return to Yoxford

The Post Office in a Suffolk town is moving to new premises, and will offer longer opening hours.

Dame Fiona Kendrick:, chief executive of Nestlé  UK & Ireland

Food giant Nestlé has announced plans to close its defined benefit pension scheme, sparking the threat of industrial action.

The Treasury has sold another 1% stake in Lloyds Banking Group.

The taxpayers’ stake in Lloyds Banking Group has fallen to below 16% after the Government sold off another tranche of shares.

The installation of solar panels on the roof of Precision Marketing Group's premises in Lamdin Road, Bury St Edmunds

A Suffolk-based firm will be among the organisations taking part in a nation-wide celebration of solar energy tomorrow.

Candy Gaga'’s Wanda Hewell, right, and daughter, Cherish.

Tower Ramparts in Ipswich now has its very own castle – thanks to the success of a local sweet shop business.

Stansted Airport

A report into the future of Britain’s airports does not rule out a second runway at Stansted – and raises fears of extra night flights to the Essex airport.

Growth in manufacturing eased last month  to its slowest level in two years.

Britain’s manufacturing sector grew at its slowest pace in more than two years last month, impacted by subdued demand from Europe.

Speedy Hire
 has warned that its results for this year will come in

Tool rental business Speedy Hire saw nearly a third of its stock market value wiped off after it announced the shock departure of its chief executive and warned over a major blow to full year profits.

Greene King chief executive Rooney Anand.

Pubs and brewing group Greene King today posted another year of record revenues, with sales within its key Retail division topping £1billion for the first time.

Suffolk Coastal considers convenience store bid

Planning chiefs have responded to concerns about noise and antisocial behaviour arising from proposals for a new convenience store in Kesgrave by insisting on closing times being brought forward an hour and the installation of a barrier to restrict overnight parking.

Most read

Topic pages