The Federal Reserve Board has fined Finnish bank Postipankki Ltd. $900,000 for misreporting trading losses at its U.S. branch.
Postipankki did not admit to any of the allegations but consented to the fine and agreed to take action to address Fed concerns.
The bank incurred a $23.2 million loss during the first quarter of 1995 on interest-rate swaps but allegedly did not report the results in the hope of recovering the loss in subsequent trading. Losses for the year totaled $120 million, said sources who worked there at the time.
The losses led to the resignation of several senior officers of the bank in the United States and in Finland.
Postipankki is the latest of a growing number of foreign banks that U.S. banking supervisors have cracked down on for allegedly failing to comply with regulations.