Watchdog backs Libor fine cuts

 
Tim Wallace
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BARCLAYS deserved a multi-million pound reduction in its Libor manipulation fine because it worked hard to cooperate with the investigation, the Financial Service Authority insisted today.

Defending itself against questions from the Parliamentary Commission on Banking Standards, the FSA said it is vital to encourage banks to be open with information.

Barclays received a 30 per cent discount for settling early, trimming its fine from £85m to £59.5m.

“Early settlement has many potential advantages as it can result, for example, in the saving of FSA resources, messages getting out to the market sooner and a public perception of timely and effective action,” said the FSA.

“We therefore consider that it is in the public interest for matters to settle, and settle early, if possible.”

But the FSA added this discount already came on top of another cut awarded because Barclays had been helpful through the investigation, not just in the settlement process.

“The benefits of co-operation with the FSA are cumulative – the fact of a firm’s recognition of its own failings and remedial steps taken post-offending can result in a lower than otherwise penalty, which is then further reduced by the settlement discount,” it explained.