Another RBS trader suspended over foreign exchange rigging probe

RBS building

Another currency trader at Royal Bank of Scotland has been suspended as regulators around the world continue their investigation into potential rigging of the £3tn a day foreign exchange market.

The bank would not comment on reports that Ian Drysdale had been placed on leave earlier in the week and was now suspended, becoming the third RBS forex trader to be suspended.

RBS is just one of a handful of banks suspending or firing traders amid allegations that Martin Wheatley, the chief executive of the Financial Conduct Authority, has said are every bit as bad as those about Libor, the benchmark interest rate.

As many as 20 foreign exchange traders are thought to have been asked to stay away from their roles in banks around the world as a result of the investigations which are thought to be at the early stages.

The 81% taxpayer-owned bank is also continuing to take hits to clean up past issues, with a $275m (£165m) payout on Wednesday to settle a class action suit relating to the way it sold mortgage-based securities during the 2008 banking crisis.

Such costs are among the reasons that the bank is expected to slump to a £8bn loss when it reports its results for 2013 next week, after it said it was setting aside £3bn for forthcoming potential legal bills.

The bank is also continuing to slim down its investment bank, reaching an agreement to sell its equity derivatives business to French bank BNP Paribas under a plan devised by former chief executive Stephen Hester, who was replaced in October by Ross McEwan. The bank did not disclose the size of the sale or the number of individuals involved in the transaction.

The new boss is expected to unveil his strategy for the bank next week.

Powered by article was written by Jill Treanor, for The Guardian on Wednesday 19th February 2014 20.28 Europe/London © Guardian News and Media Limited 2010


image: © Mark Ramsey

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