UBS faces $1 billion Libor settlement

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Swiss bank UBS is expected to be landed with a $1 billion (£620 million) bill to settle claims that it rigged Libor.

Sources said the announcement could come as early as Monday, making the group the second financial services giant to pay out over the scandal.

In June, Barclays was fined a record £290m by UK and US regulators over its part in manipulating Libor, a key benchmark used to set interest rates on loans and mortgages.

UBS declined to comment, as did the agencies expected to be involved in the settlement, including the UK’s Financial Services Authority and the US Department of Justice and Commodity Futures Trading Commission.

Around 20 financial institutions have been investigated over the alleged rigging of Libor, and state-backed Royal Bank of Scotland has previously said it hopes to settle any claims soon, warning that potential penalties could be significant.

Focus on the banking sector has intensified further as HSBC revealed a $1.9bn settlement for failing to comply with anti-money laundering rules, and Standard Chartered paid out an additional $327m over allegations that it breached sanctions over Iran.