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By Mark Kleinman, City Editor

Three of the UK's biggest banks are poised to set aside roughly £1bn for settlements with regulators during the next week following a probe into the abuse of critical foreign exchange benchmarks.

Sky News understands that Barclays, HSBC and Royal Bank of Scotland (RBS) plan to make the aggregate provision as part of their third-quarter results during the next week.

The charges will come ahead of a prospective deal with the Financial Conduct Authority (FCA), which could be announced as soon as next month.

The exact sums that the three banks will set aside was unclear on Wednesday, but sources indicated that the cumulative figure would be in the region of £1bn, underlining the scale of the penalties to be handed out by authorities in London and New York.

One source said at least one of the banks was likely to set aside a much higher figure than its anticipated FCA fine amid ongoing discussions with authorities in the US.

The provisions, which will follow similar moves earlier this month by Citigroup, UBS and JP Morgan, follow crunch talks held between the six banks and the FCA in September.

Sky News revealed details of those discussions, although sources said the aggregate penalty for the six banks from the FCA would be lower than the £2bn indicated a few weeks ago.

The so-called omnibus settlement, which the banks have been keen to coordinate with the FCA, will be the largest collective penalty ever imposed by the City watchdog.

The FCA will find the banks guilty of a string of systems and control failures in their foreign exchange businesses following the emergence of concerns that currency markets had been manipulated in a similar way to interbank borrowing rates such as Libor.

The timetable for the settlement could yet slip.

One source said the fact that the regulator had indicated the scale of potential fines during recent talks meant that banks were now under pressure from auditors to allocate provisions in their third-quarter results.

The FCA, Barclays, HSBC and RBS declined to comment on the ongoing foreign exchange settlement talks.