For the banks and their investors, such penalties have become almost run of the mill. Deutsche Bank, for example, the hardest hit with a combined € 724 million fine, suffered a share price fall of only 0.7 percent in Wednesday morning trading.
Similarly, when JPMorgan recently struck its record USD 13 billion settlement with US authorities over mortgage product mis-selling, shareholders barely blinked. The US bank's share price is actually up 10 percent over the past three months, despite the settlement and the fact that it pushed JPMorgan to a loss in the third quarter of the year for the first time in a decade.
So, do shareholders simply not care? Some clearly do, as evidenced by the vitriol posted online by investors. They are furious that the fines being extracted by regulators are funnelled into the coffers of the public authorities at the expense of shareholders, while the actual transgressors, the dozens of traders around the world and across a string of banks who actually manipulated the rates, have so far gone unpunished.
The momentum of shareholder money, though, takes a forward-looking view. Even if there is a hit to earnings from a big settlement from one legacy issue or another, the real investor focus is on what future earnings will look like.
That is short-sighted. Three of the four banks that settled Libor accusations with UK and US authorities - Barclays, Royal Bank of Scotland and Rabobank - also lost their top two or three bosses as a direct or indirect result. With unlisted Rabobank, it is too soon to say what harm the incident will cause, but in the case of Barclays and RBS it has, if anything, made the outlook look more unstable. Anecdotal evidence would suggest that politicians and regulators have gone after both banks with renewed vengeance.
Clearly banks' longer-term share price performance has multiple drivers. But a lot of the underperformance in Barclays' and RBS's shares over the past six months can be traced one way or another back to that Libor effect.
The question now is whether a broader spread of banks, including the big US groups, face a similar fate. The latest EU settlement brings Citigroup and JPMorgan into the fray, as well as Deutsche Bank and Société Générale, while HSBC and Crédit Agricole are contesting the accusations against them. UK and US settlements may follow.
The immediate share price impact from the EU's actions might be negligible but long-term investors be warned.
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