The European Commission has fined a string of lenders, including Royal Bank of Scotland Group (LON:RBS) for rigging the foreign exchange market, Brussels has said. The lender, which remains part-owned by the UK government, said that its fine was covered by existing provisions.
RBS’ share price has been little changed in afternoon trade, having inched 0.04 percent lower to 230.10p as of 14:16 BST. The stock is marginally underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.21 percent higher at 7,312.27 points. The group’s shares have given up more than 18 percent of their value over the past year, as compared with about a 5.4-percent dip in the Footsie.
RBS fined over forex rigging
The European Commission announced in a statement today that it had fined five banks for taking part in two cartels in the Spot Foreign Exchange market for 11 currencies. The first decision imposes a total fine of €811 million on RBS (LON:RBS), Barclays (LON:BARC), Citigroup and Morgan, for participating in the ‘Three Way Banana Split’ cartel. The second decision includes a fine of €258 million on Barclays, RBS and MUFG Bank over the ‘Essex Express’ cartel. UBS meanwhile was excused financial penalties for revealing the cartels’ existence.
RBS acknowledged the settlements in a statement, noting that its €249-million share of the fines was ‘fully covered by existing provisions’. The bailed-out lender noted in the statement that the fine related to conduct which took place in two groups of chatrooms in periods between December 2007 and November 2011.
Analysts on FTSE 100 group
JPMorgan Chase & Co, which is neutral on the bailed-out lender, lowered its target on the RBS share price from 290p to 260p last week. According to MarketBeat, the blue-chip group currently has a consensus ‘buy’ rating and an average valuation of 307.08p.
RBS updated investors on its first-quarter performance last month, posting a drop in profit and flagging more challenging near-term income growth.