Costs rise at world’s local bank

MAJOR BANKS have set aside almost $7bn – £4.38bn – for potential settlements with regulators investigating allegations of collusion and manipulation in foreign exchange markets, the first of which could come in Britain later this month.

By The Newsroom

Published 4th Nov 2014, 02:55 BST

Europe’s largest bank HSBC yesterday was the latest bank to make provisions in its most recent earnings report, putting aside £236m specifically for a potential settlement with the Financial Conduct Authority.

HSBC is the last of six banks in talks with the FCA over a group FX settlement to report their results. The other five also set aside substantial sums for litigation provisions.

Royal Bank of Scotland and Barclays last week set aside $640m and $800m, respectively, specifically for settlements related to the global FX probe which has been running for a year.

This means the three British banks have made almost $1.8bn provisions in their latest earnings reports specifically for FX-related issues.

However, with potential settlements still to come with the US the final bill could be much higher.