Shares in Royal Bank of Scotland ended the first trading day of 2015 down 1.5% amid concern about the scale of penalties the bailed-out bank could face from US regulators.
The 79% taxpayer-owned bank has already signalled that it faces a hefty fine from US regulators over the way it packaged up mortgage bonds in the run up to the banking crisis, setting aside almost £2bn to cover potential penalties.
The bank would not comment on a report in the Times newspaper that the fines could balloon to more than £5bn, although it has repeatedly warned that the investigation by the US authorities into its bond sales is ongoing.
Regulators in the US – including the Federal Housing Finance Agency – have already fined a number of banks for the way the bonds were packaged up and sold on to investors who then lost out.
RBS shares closed at 388p.
It is not clear when RBS will announce the terms of a settlement with the US authorities. Before Christmas, the bank said it was freezing the bonuses of 18 traders as part of a continuing internal investigation into the rigging of foreign exchange markets, for which it has already been fined £217m by the UK watchdog, the Financial Conduct Authority.
Last year, RBS was also fined £56m for a breakdown in its IT systems which left 6.5 million customers locked out of their bank accounts for days, and in the case of its Ulster Bank operations for weeks.
