As the bank admitted it had slumped to a third-quarter loss as a result of the payment protection insurance scandal, it revealed that US regulators were now looking at the crucial fundraising in 2008 from Middle Eastern investors that is also being investigated by the Financial Services Authority.
Antony Jenkins, promoted to chief executive after Bob Diamond left in the wake of the Libor-rigging scandal, insisted the bank would "vigorously defend" itself against the potential fine from the United States Federal Energy Regulatory Commission (FERC) office of enforcement which could be announced later on Wednesday.
The matter relates to Barclays' power trading in the western US from late 2006 to 2008.
The FSA is also analysing the disclosures the bank made about its crucial fundraisings in 2008 and the US authorities – the department of justice and US Securities and Exchange Commission (SEC) – are now investigating whether these fundraisings were "compliant" with the US Foreign Corrupt Practices Act. Barclays said it was "fully co-operating" with the two regulators. The bank admitted in July that its finance director, Chris Lucas, and three others were being investigated by the FSA for two fundraisings that took place to help the bank avoid a bailout by the taxpayer in 2008.
The latest admissions by the bank come in a week in which a high court judge has ruled that Diamond and other bankers should be hauled before the court to explain what they knew about Libor rigging in a case brought by Guardian Care Homes which is largely about the mis-selling of interest rate swaps.
In the third quarter the bank slumped to a £47m loss, which had been expected after the bank stunned the City earlier this month by setting aside another £700m to cover the cost of PPI mis-selling claims, taking its bill to £2bn. Over the nine months to the end of September, profits were down 86% to £712m as a result of the PPI charge and the fluctuations in the cost the bank faces in buying back its own debt, which has led to a £4bn charge. Stripping these out, the bank focused on a 18% rise in adjusted profits to £6bn. A year ago, profits were £5bn over the same period and in the third quarter reached £2.4bn – but stripping out a gain on the value of its own debt and other one-off items, profit had been £1.3bn a year ago.
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