Barclays: forex fine may top £500m

BARCLAYS boss Antony Jenkins has warned the £500m it has set aside to settle foreign exchange-rigging allegations is unlikely to be enough, writes James Salmon.

The bank refused to take part in a joint £2bn settlement last month involving UK and US regulators and five banks, including HSBC and Royal Bank of Scotland.

But it still faces a huge fine and has set aside some £500m to cover the settlement.

In an interview conducted with Sky News, Jenkins said: ‘My expectation is it will be a bigger number than that’.

This suggests it faces a bigger penalty than the RBS and HSBC banks, which paid £400m and £390m respectively.

Barclays is being investigated by at least six regulators around the world, including the UK’s Financial Conduct Authority and the US Department of Justice, over allegations its traders manipulated the £3trillion a day foreign currency market.

Jenkins came under fire earlier this year after the bank hiked bonuses by 10pc to £2.4bn for their work last year, despite a 32pc drop in profits.

He indicated the bank will show more restraint in the next bonus season in the New Year, arguing it will be less controversial.

The 53-year-old, who is radically shrinking Barclays’ investment bank, also said the ‘universal banking model is dead’.

He argued that tougher regulations and the huge investment in technology required means lenders have to focus on their strengths.