The U.K.'s top financial watchdog has fined Merrill Lynch International £34.5 million ($45.5 million) for failing to report exchange derivative traded transactions over a two-year period.

The Financial Conduct Authority on Monday said that the bank failed to report 68.5 million transactions between Feb. 12, 2014 and Feb. 6, 2016.

This was the first enforcement action against a firm for failing to report details of trading in exchange traded derivatives, under the European Markets Infrastructure Regulation.

Reporting exchange traded derivative transactions allows authorities to authorities assess and address the risk inherent in financial systems caused by a lack of transparency, the FCA said. The reporting requirement was introduced in 2008.

"Effective market oversight depends on accurate and timely reporting of transactions. The obligations under EMIR, as with MiFID, are key aspects of such oversight," FCA Executive Director of Enforcement and Market Oversight Mark Steward said in a statement.

"It is vital that reporting firms ensure their transaction reporting systems are tested as fit for purpose, adequately resourced and perform properly. There needs to be a line in the sand. We will continue to take appropriate action against any firm that fails to meet requirements."

Merrill Lynch agreed to an early stage of the investigation and received a 30% reduction in their overall fine. Without this discount the fine would have been £49.3 million.

Merrill Lynch International is Bank of America Corp.'s (BAC) - Get Report largest broker outside the U.S.

More of What's Trending on TheStreet: