Both banks reported strong underlying figures on Monday but revealed they were being hit by regulatory probes following increased scrutiny and ongoing investigations into their private trading “dark pools”.
Dark pools are privately run securities exchanges designed largely for the use of institutional investors which want to make trades, without alerting the wider market.
UBS’ £781m profit for the last three months was down 13% on the whole year following a Sfr300m (£195m, $331m, €247m) settlement with German regulators over claims of tax dodging, while Deutsche Bank saw a 16% rise in profits to £726m.
Last Month, the New York Attorney General sued Barclays over allegations that investors were left exposed to predatory trading practices in relation to its Dark Pool.
Attorney General Eric Schneiderman said Barclays “dramatically increased the market share of its dark pool through a series of false statements to clients and investors about how, and for whose benefit, [Barclays] operates its dark pool”.
It was claimed that Barclays had assured investors its Dark Pool was monitored, and that any predatory traders would be identified and barred.
Barclays acknowledged the issue, saying: “We take these allegations very seriously. Barclays has been cooperating with the New York Attorney General and the SEC and has been examining this matter internally.”
