The news agency reports that the transaction caused a stir because it triggered a wave of computer-generated, or algorithmic trades from other banks. It took place on the EBS foreign exchange platform and briefly pushed the euro up near a five-month high against the Swiss franc.
When the incident happened, traders had speculated that it was a faulty algorithmic system at RBS that caused the run-up in the euro, although that turned out to be not the case.
In the meantime, Reuters also reports that Bank of Tokyo-Mitsubishi UFJ has suspended a third London-based banker in connection with a probe by UK authorities into the rigging of interbank lending rates. The bank has confirmed that the banker has been told to stay at home.
And The New York Times reports that over objections from consumer groups and New York officials, a federal judge on Tuesday approved a $4.8m settlement between the Justice Department and Morgan Stanley over accusations of price fixing in the electricity market.
Yet even as he signed off on the settlement, Judge William H. Pauley III of Federal District Court in Manhattanexpressed 'misgivings' about the deal, saying the dollar amount was too low.
'Given the government’s stark allegations of manipulative conduct against Morgan Stanley, disgorgement of $4.8m is a relatively mild sanction', Judge Pauley wrote. 'There is a risk that a large financial services firm like Morgan Stanley could view such a modest penalty as merely the cost of doing business'.
'We still do not expect the macroeconomic and market environment to stabilize in the second half of 2012', Chief Financial Officer Stephan Engels said in the statement. 'We expect operating profits to continue to be under pressure'.
image: © Justin Marty