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NWG Natwest Group Plc

265.50
2.70 (1.03%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Natwest Group Plc LSE:NWG London Ordinary Share GB00BM8PJY71 ORD 107.69P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  2.70 1.03% 265.50 265.80 265.90 266.60 263.70 265.00 25,164,662 16:35:01
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Commercial Banks, Nec 14.77B 4.64B 0.5271 5.04 23.38B

Banks to Pay $5.6 Billion in Penalties in FX, Libor Probe -- Update

20/05/2015 3:53pm

Dow Jones News


Natwest (LSE:NWG)
Historical Stock Chart


From Mar 2019 to Mar 2024

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By Aruna Viswanatha 

WASHINGTON--Five global banks have agreed to pay more than $5 billion in combined penalties and will plead guilty to criminal charges to resolve a long running U.S. investigation into whether traders at the banks colluded to move foreign currency rates in directions to benefit their own positions.

Four of the banks, J.P. Morgan Chase & Co., Barclays PLC, Royal Bank of Scotland Group PLC, and Citigroup Inc., will plead guilty to conspiring to manipulate the price of U.S. dollars and euros, authorities said.

The fifth bank, UBS AG, received immunity in the antitrust case, but will plead guilty to manipulating the Libor benchmark after prosecutors said the bank violated an earlier accord meant to resolve those allegations of misconduct. UBS will also pay an additional Libor-related fine.

The banks will pay a combined $5.6 billion to various state, U.S. and U.K. authorities to resolve the foreign exchange and Libor probes.

Bank of America Corp. will also pay a $205 million penalty to the Fed to resolve the regulator's foreign exchange probe. Bank of America didn't face similar action from the Justice Department.

The fines, which include penalties from the Federal Reserve and other regulators, come on top of a combined $4.3 billion many of the same banks paid in November to resolve similar charges from U.S. and U.K. regulators.

Authorities said euro dollar traders at the banks, who were self-described members of "The Cartel" communicated through coded language in an online chat room to coordinate attempts to move rates set at 1:15 and 4 p.m.

The traders would withhold bids or offers to avoid moving the rate in directions that would hurt open positions held by other members of the group, in violation of antitrust laws, prosecutors said.

No traders have yet been criminally charged over the conduct, but New York's financial regulator said it required Barclays to fire eight employees in connection with the resolution. Investigations into individuals are continuing, according to government officials.

Lawyers for the banks are expected to enter a series of pleas in federal court in Connecticut later on Wednesday.

Citigroup, which was accused of being involved in the misconduct from December 2007 through January 2013, is paying the largest criminal fine of $925 million. The other banks were accused of engaging in the conduct for various periods with that time frame.

"The behavior that resulted in the settlements we announced today is an embarrassment to our firm, and stands in stark contrast to Citi's values, " Chief Executive Michael Corbat said in a news release, adding its internal investigation has so far resulted in nine terminations.

The New York bank noted the settlements are covered by its existing legal reserves and won't require a charge to earnings in the second quarter.

J.P. Morgan executives made similar comments in the wake of the settlement. The bank said the conduct underlying the antitrust charge is principally attributable to a single trader, who has since been dismissed, and his coordination with traders at other firms.

Under its settlement with the Justice Department, J.P. Morgan will pay a fine of $550 million, while the Fed penalty is $342 million. The bank has previously reserved for the settlements.

One bank, Barclays, pulled out at the last minute of the November settlement with regulators, and is now paying around $2 billion to the Department of Justice, the Federal Reserve, the Commodity Futures Trading Commission, the New York State Department of Financial Services, and the U.K. Financial Conduct Authority.

It also agreed that its foreign exchange trading and sales practices violated its 2012 Libor agreement, and agreed to pay an additional $60 million penalty.

Prosecutors said UBS would plead guilty in connection with similar violations. They said UBS engaged in deceptive foreign exchange trading and sales practices after its 2012 agreement, including by adding undisclosed markups to certain customers' transactions in which traders and sales staff told customers there were no markups added.

One UBS trader also engaged in the same collusive behavior in the euro and dollar market, but the bank wasn't charged over that conduct because it had obtained immunity by being the first bank to report the possible antitrust violations.

The five banks will be under a three-year period of probation, overseen by the court.

Write to Aruna Viswanatha at aruna.viswanatha@wsj.com

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