Royal Bank of Scotland may have to set aside $15.4bn in additional conduct costs, following probes into currency market rigging and U.S. mortgage-backed securities, according to Keefe Bruyette & Woods Inc.
Bloomberg News reports that the lender may take $4bn of charges to settle foreign-exchange and other regulatory investigations in benchmark rigging, analysts Mark Phin and Richard Smith wrote in a note to clients.
Shareholder lawsuits over a 2008 fundraising just before the bank was bailed out could cost as much as $6.8bn, they wrote.
'RBS looks one of the most exposed European banks to litigation and conduct risk', the analysts wrote. 'It will take time to gain comfort over the ultimate costs'.
The $15.5bn total includes a possible $2.8bn provision to settle claims of misconduct in its handling of U.S. mortgage securities.
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