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RBS reignites bonus row as £500m Libor fine looms

by Alex Steger on Jan 29, 2013 at 07:49

RBS reignites bonus row as £500m Libor fine looms

Royal Bank of Scotland (RBS) is preparing to pay as much as £250 million in bonuses to staff at an investment banking division heavily implicated In the Libor rigging scandal, according to the Financial Times.

The FT reported that the move comes as RBS prepares to settle with US and UK regulators over the Libor scandal with a fine expected to top £500 million, meaning the taxpayer will effectively be paying RBS investment bankers about £250 million in bonuses, while simultaneously footing the bill for Libor fixing.

The paper said the majority of the Libor fine, around £400 million, will be paid to US authorities, while £100 million could go to the Financial Services Authority.

10 comments so far. Why not have your say?

John Smyth 3

Jan 29, 2013 at 08:56

The financial and political system in our country is corrupt from top to bottom.

The investment banking division was not only heavily involved in Libor rigging but they and their counterparts in other banks in this country and the USA brought our economy into the mess it is in now and we the taxpayers and working people are footing the bill for their greed and ineptitude.

These people should now be on unemployment benefit never mind being paid bonuses for playing around with our money and making yet more illusory money which may well go up in smoke in the near future. They are still playing the same games they did prior to 2008 because none of our politicians has the balls, honesty or integrity to take the banks and other big financial institutions on.t

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John D

Jan 29, 2013 at 10:44

Please tell me this is a joke.

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Hickky

Jan 29, 2013 at 10:45

So as long as the staff who are due bonus were not implicated in the LIBOR fixing scandal, what's the story? If the investment bankers made proper profits for their division honestly, let them get paid!

John Smyth3 wants to get the innocent to pay for the abuses of others. I think he should work for the FSCS.

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John Bees

Jan 29, 2013 at 11:01

Whats the cost of the SWAP loan missell?

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Hickky

Jan 29, 2013 at 11:15

Does misselling mean any product that all clients do not benefit is missold? When markets go against you it is misselling, when you benefit, it is not enough!

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Usually found sitting on the fence

Jan 29, 2013 at 11:31

I am with Hickky on this. I feel the above is worded poorly with a view to angering readers. If the Investment Bankers are innocent of wrongdoing and if the division has created a justification for the bonuses (as per their contracts), then where is the story? Is the whole mess distasteful and saddening, yes, but the problem is that the guilty, the greedy and the ignorant are not being weeded out fast enough and there is little, if any, sign of any individual(s) being held accountable. But penalising the innocent, hard working and honest staff is not the solution...

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John Smyth 3

Jan 29, 2013 at 15:02

@ Hickky

Come on fella. Do you really think that it will be the innocents getting the bulk of the £250 million? The bulk of it will be going to the guys or girls at the top who were the guilty ones in the Libor scandal and the gambling/trading in rubbish instruments which brought the bank down and the country with it. Even the ones you credit with being innocent should not be getting any bonuses. They should be grateful they have a job.

The £250 million should be given to the taxpayers for bailing them out and preserving their jobs. Any other type of company in any other business would have been let go bust and they would be unemployed.

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John Bees

Jan 29, 2013 at 16:19

Ref Hickky, misselling is sellin a product that benefits the seller rather more than the customer, in fact in the case of SWAP loans, they nonly beneffited the bank not the customer. Most of them were sold in 2008 as a hedge against interest rates increasing, however all the idicators at the time (bank of england quarterly notes) were showing interest rates falling. the SWAP premiums were

huges and the breakage costs enormous. no benefit to the customer, in any event if you hdge against rates increasing, then it is possible to hedge against rates falling.

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John Bees

Jan 29, 2013 at 16:19

As above

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Usually found sitting on the fence

Jan 29, 2013 at 17:37

@ John Smyth 3 - Until proven guilty, they are all innocent. Surely the problem centres on the fact the Govt used tax payers cash and then failed to impose sensible parameters on salary and bonuses. They should have been stronger, they should have been more demanding in terms of amending the bonus culture, they had the chance and got it wrong. The following Govt have done little to address this too. As for being grateful for their jobs, of course they should be, but the Govt did not pay up to save jobs, they paid up to save the banking sector from potentially dominoeing into chaos!! In my opinion. What state would the economy have been in if Northern Rock failed, if RBS followed...

@ John Bees - I must have a word with my local barman, he keeps misselling me "one for the road" ;-)

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