The Guardian has published an interview on its site with Stephen Hester in which the RBS chief executive predicts his bank is facing a huge fine for its part in the Libor fixing scandal. He says:
‘RBS is one of the banks tied up in Libor. We’ll have our day in that particular spotlight as well.’
Hester can to a certain extent afford to be upfront about what is coming down the line for his bank. Even though it was clear from the start that there were other banks wading around in this swamp, Barclays took the majority of the flak as the first one to be fined. There might be another round of emails about bottles of Bollinger to feast upon, but the revelations will not be as shocking the second time around. Hester has also already taken the step of forgoing his bonus for the year, which means he now cuts a slightly less offensive figure than Diamond did.
The focus also moved a while back from the banks themselves to the regulatory system that did not flag up this activity – or which seemed to be aware of what Bank of England Deputy Governor Paul Tucker called a ‘malfunctioning market’ but failed to highlight possible manipulations as needing investigation. The details that the FSA releases when it fines RBS may well teach us more about the failings of the regulators than they do about the banking culture.