UBS is to pay CHF1.4bn ($1.5bn) to US, UK and Swiss authorities to resolve investigations into its manipulation of international inter-bank rates – its largest ever fine and the second largest ever.

UBS will pay £160m ($261m) in fines to the UK Financial Services Authority (FSA) and CHF59m as disgorgement of estimated profits to FINMA. The largest fine totalling $1.2bn is to be paid to the US Department of Justice (DoJ) and Commodity Futures Trading Commission.

The settlements were in connection to the manipulation of benchmark interest rates including the Yen LIBOR, GBP LIBOR, CHF LIBOR, Euro LIBOR, USD LIBOR, Euribor and Euroyen TIBOR, although the nature and extent of the conduct in question varied significantly from one currency to another, the bank said.

Japanese unit enters plea for wire fraud
As part of a proposed agreement with the US Department of Justice (DoJ), UBS Securities Japan (UBSSJ) has agreed to enter a plea to one count of wire fraud relating to the manipulation of certain benchmark interest rates, including Yen LIBOR.

UBS flagged up that its fourth quarter net profit attributable to shareholders will show an estimated loss of between CHF2 to 2.5bn, primarily as a result of litigation and regulatory matters.

The UK FSA said the misconduct was "extensive and widespread" with at least 2,000 requests for inappropriate submissions documented between January 2005 to 31 December 2010. In total at least 45 individuals including traders, managers and senior managers were involved in, or aware of, the practice of attempting to influence inter-bank rate submissions.

The largest fine ever was slapped on HSBC earlier this month when it agreed to pay US authorities $1.92bn in relation to investigations regarding inadequate compliance with anti-money laundering and sanction laws.