RBS says forex fines to influence future pay decisions

LONDON (Reuters) - Royal Bank of Scotland said it would take into account the $669 million (430 million pound) paid in fines to U.S. authorities following misconduct in its foreign exchange business when making future pay decisions for its staff. State-backed RBS was one of four major banks which pleaded guilty to trying to manipulate foreign exchange rates and one of six banks to be fined a total of nearly $6 billion in a settlement that substantially ends a global probe into the $5 trillion-a-day market. The bank, 80 percent owned by the British government, said it had dismissed three people and suspended two more pending further investigation as part of its internal review into the matter. "We are determined to learn lessons from our past mistakes and to hold those responsible fully to account for their actions," Chief Executive Ross McEwan said on Wednesday. McEwan's efforts to turn around the bank, which was rescued using 45.5 billion pounds ($71 billion) of taxpayers' money during the 2007-9 financial crisis, have been hampered by issues relating to past misconduct. The bank is expected to pay billions of dollars to U.S. authorities later this year to settle claims of misconduct in its handling of U.S. mortgage securities. "It has taken far longer than anyone hoped to root out all the past conduct problems and practices and as a result we still have significant challenges on the horizon," McEwan said. RBS said the forex fines were covered by its existing provisions and shares in the bank extended earlier gains to trade up 2 percent by 1450 GMT. ($1 = 0.6434 pounds) (Reporting by Matt Scuffham; Editing by Sinead Cruise)