The markets division of the Royal Bank of Scotland has prohibited the use of multi-dealer online chat rooms, Reuters reported. The lender joins other lenders that have undertaken a similar move to respond to investigations from regulatory authorities.

The report said regulators have been focusing on chat rooms in their investigations regarding the rigging of the benchmark interest rates of the Libor and Euribor. It is also included in the probe regarding the possible price fixing involving the $5.3 trillion-a day foreign exchange market.

RBS confirmed a Bloomberg report which said that the bank had already informed the front office staff in its markets division that unless specified criteria were met, all the permanent chat rooms used to communicate with workers at other banks, bank entities or competitors have already been banned. The prohibition included chat rooms with clients, brokers and securities companies.

The lender also instructed its staff that to immediately close all social chat rooms. RBS said chats should be used for business-related purposes only and that these conversations should follow the group's guidance on competition law.

Citing people who have knowledge of the matter, the report said that the largest bank in the US in terms of assets, JPMorgan Chase, was also considering a ban of multi-dealer online chat rooms as well as prohibiting staff from using the rooms for social purposes.

Deutsche Bank had already banned the use of online chat rooms among its foreign exchange and fixed income staff while UBS also prohibited its investment banking division from using its multi-bank and social chat rooms, the report said. Sources also told Reuters that Citigroup and Barclays have also banned the use of chat rooms.

The report said traders in banks and financial firms often talk with each other through the internet using third-party services such as those from Bloomberg LP and Thomson Reuters.