Bank conduct fines ‘hurt recovery bids’
“This is a considerable dent to rebuilding capital in the banking system,” said Bailey in an interview. “It’s also quite hard as a prudential regulator — and we have to think about this in the context of stress tests — how do you go about predicting and putting in sensible assumptions for future conduct costs.” BNP Paribas SA was fined a record $8.97bn (€6.6bn) last month by US regulators for processing billions of dollars in banned transactions from 2004 to 2012 involving Sudan, Iran and Cuba. At least nine firms have been fined more than $6bn for manipulating benchmark interest rates. Bailey, who is also chief executive officer of the BOE’s Prudential Regulation Authority supervising banks, said it’s important that regulatory actions don’t undermine the stability of the financial system.
