is the latest in a line of banks that are speaking to regulators (Photo: Reuters)
HSBC is the latest in a long line of banks to reveal that it is cooperating with Britain's Financial Conduct Authority and other global regulators over a raft of investigations into potential manipulation of currency markets.
According to the bank's third quarter results statement, HSBC revealed that it is "cooperating with investigations by the FCA and other regulators related to trading on the foreign exchange market by a number of firms."
HSBC's CEO Stuart Gulliver added that no one has been suspended in relation to the FX fixing investigation as "names given do not work for the bank anymore."
"We haven't suspended anyone. It's at a very early stage and the names we've been given so far don't work for us any more," he added.
On 30 October, Barclays said it is also cooperating with watchdogs over potential FX rigging.
Barclays said it was reviewing its foreign exchange trading "covering a several year period," following a number of global regulators' probes into possible FX fixing.
Since then, six Barclays traders and two RBS traders have been suspended amid global regulators' investigations into potential attempts to manipulate the foreign currency markets, according to reports.
It follows news that Citigroup, Standard Chartered and JPMorgan traders had been put on leave, though not suspended or suspected of wrongdoing, in relation to the same probes.
The daily $5tn currency market is the largest in the financial system and is pegged to the value of trillions of funds, derivatives and financial products. Morningstar estimates that $3.6tn in funds, including pension and savings accounts, track global indexes.
Banks Build War Chests
On 29 October, Deutsche Bank revealed that its balance sheet was hit by billions of euros of litigation costs which subsequently led the German lender to report a near 100% drop in profits.
Deutsche Bank revealed in its third quarter results statement that its total litigation reserves pot, which is used for anticipated legal difficulties, stands at €4.1bn (£3.5bn, $5.6bn), after rising by €1.2bn.
UBS followed in Deutsche Bank's footsteps and said it has deferred a key earnings target by a year because of temporary demands to hold extra capital to deal with unresolved legal issues.
According to UBS's third quarter results announcement, the Swiss banking giant has imposed a temporary 50% capital top-up over the coming year, in a bid to deal with potential costs of unknown legal probes, compliance issues and other risk matters.
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