Monetary Authority of Singapore
The Monetary Authority of Singapore building, Singapore

Singapore's monetary watchdog has ordered at least three British banks to set aside hundreds of millions of pounds over suspected manipulation of a Singaporean benchmark interest rate called Sibor.

The Royal Bank of Scotland (RBS), Barclays and Standard Chartered have been ordered to allocate more than £1bn (€1.2bn/$1.6bn) by the Monetary Authority of Singapore (MAS) to cover "deficiencies and risks" as part of the authority's ongoing investigation into the rigging of Sibor during a period between 2007 and 2011. The authority is probing about 20 banks over rate rigging.

RBS was ordered to set aside £510m to £612m, while Barclays and Standard Chartered have been told to allocate between £200m to £300m each in connection with the probe.

The development comes less than a year after a number of British banks were fined over the manipulation of the London-based benchmark rate, Libor.

"RBS has co-operated fully with MAS on its review of benchmark submissions and will comply with any required regulatory, capital and remedial measures," the bank said in a response.

The MAS noted that 133 traders between these banks were found to have tried to manipulate the benchmark interest rate. The allocated money will be kept at 0% interest rates for a year, while the central bank considers measures to prevent rate rigging, including making it a criminal offence.

"Although the number of traders involved represents a small proportion of the trading community in Singapore, MAS takes a serious view of the need to uphold high standards of integrity in the industry and expects banks to foster a culture of ethical conduct among all their employees," the central bank said in a statement.

Other global banks including Bank of America, BNP Paribas and the Overseas-Chinese Banking Corporation were also ordered to increase their reserves at MAS by S$700m to S$800m. Other banks in the probe include Credit Suisse, Deutsche Bank, HSBC and JPMorgan Chase.