UBS CEO Sergio Ermotti. Picture: REUTERS
UBS CEO Sergio Ermotti. Picture: REUTERS

ZURICH — Swiss bank UBS is expected to pay more than $450m to US and British authorities to settle claims that some of its employees submitted false Libor rates, the New York Times reported.

In June, British bank Barclays was fined $453m for manipulating London interbank offered rate (Libor) benchmark interest rates, becoming the first bank to settle in the ongoing probe, prompting the resignation of its chairman and CE.

UBS was the first bank globally to report suspected rate rigging, and has said it has received conditional immunity from some authorities for co-operating in their probes.

A UBS spokeswoman told Reuters the bank was in the midst of discussions with authorities in the US and Britain in connection with Libor investigations and had been co-operating fully with the regulatory and enforcement authorities, but gave no further details.

Christopher Hamilton, spokesman for Britain’s Financial Services Authority (FSA), declined to comment beyond confirming the already established fact that the FSA was investigating UBS.

The Commodity Futures Trading Commission and the US justice department, which are investigating the Libor matter in the US, could not immediately be reached for comment.

Other banks are also anxious to draw a line under the probe, which is well into its second year. British bank RBS said last month it hoped to reach a settlement on its part in the rate-rigging scandal — likely to result in fines for the bank — and expected to start talks soon.

Morgan Stanley estimated that 11 global banks linked to the Libor scandal could face $14bn in regulatory and legal settlement costs through 2014.

The reliability of Libor has been cast into doubt by the rate manipulation accusations. Libor is intended to measure the rate at which banks lend to one another and is used as a benchmark for $300-trillion of contracts and loans across the world.

Switzerland is also investigating 12 US, European and Japanese banks suspected of conspiring to manipulate interbank lending rates. They include Credit Suisse, Deutsche Bank, HSBC Holdings and RBS.

"In Switzerland we are still investigating the case. We are in contact with other authorities," Competition Commission official Olivier Schaller said, but provided no further details.

FINMA spokesman Tobias Lux said the Swiss regulator was making ongoing efforts to clarify the issue, but declined to comment further.