Barclays and Royal Bank of Scotland will this week be hit with penalties worth nearly £3bn for rigging the foreign exchange markets.

UK and US regulators will force four institutions – Barclays, RBS, Citi and JP Morgan – to plead guilty to manipulating currency rates.

Under a cloud: UK and US regulators will force four institutions – Barclays, RBS, Citi and JP Morgan – to plead guilty to manipulating currency rates

The British banks alone will have to pay a little under £3bn for their role in the scandal.

It will come as another blow to the industry’s already shattered reputation following a string of misconduct charges in the wake of the financial crisis.

‘Each time a bank is fined it adds another layer of mistrust,’ said Tim Howarth, banking regulation partner at KPMG. ‘This in turn means politicians are better placed to talk about banker bonuses, bank levies and generally higher taxes for the industry.’