UBS In Hong Kong Probe, But No Backlash In Switzerland (So Far)

Hong Kong

UBS, which will pay $1.5bn to settle charges with U.S. and U.K. regulators for manipulating interest rates, is now under scrutiny in Hong Kong for possible misconduct linked to the city’s rates.

Bloomberg reports that The Hong Kong Monetary Authority has started an investigation to see if there was wrongdoing by the bank in its submission of data for setting the Hong Kong Interbank Offered Rate, according to a statement from the de-facto central bank Thursday. The HKMA is also reviewing whether the potential misconduct may have had a material impact on the rates.

Overseas regulators alerted the HKMA about potential manipulation of the local interbank lending rates and other reference rates in the region, it said. The move signals that the world’s biggest banks - some of which have already been penalized in Japan - may now come under scrutiny in more Asian nations even as they seek to placate U.S. and U.K. authorities.

In the meantime, Reuters reports that unlike the outrage that hit Barclays after the British bank was fined for rigging a benchmark interest rate, reaction in Switzerland to UBS's penalty for the same offence has been muted.

There appears to be little appetite to attack UBS, whose reputation has already been tarnished by a series of damaging mistakes.

The contrasting fates of the two banks may suggest a 'wait and see' policy makes more sense, according to insiders at Deutsche Bank, which is facing months of investigation for its part in the global Libor scandal.

UBS Faces Probe for Possible Misconduct on Hong Kong Rate

Swiss lack appetite for Barclays-style backlash against UBS

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