Traders are understood to have been suspended at Royal Bank of Scotland and Barclays in connection with the possible fixing of currency markets as a global investigation widens.
Reports suggest Barclays has suspended as many as six foreign exchange traders and that RBS yesterday put two of its traders on suspension as part of the probe involving regulators in the UK and worldwide.
Both banks declined to comment on the suspensions, but have confirmed they have been drawn into the investigations.
RBS said in its third quarter results today it had been contacted by the UK's Financial Conduct Authority (FCA) and other authorities.
It added: "The group is reviewing communications and procedures relating to certain currency exchange benchmark rates as well as foreign exchange trading activity and is cooperating with these investigations.
"At this stage, the group cannot estimate reliably what effect, if any, the outcome of the investigation may have on the group."
Ross McEwan, RBS chief executive, refused to comment on the case, but said it will "come down very severely on anyone we discover has been breaking the rules".
Fellow banking giant Barclays said alongside its trading update yesterday that it was also co-operating with inquiries from various authorities and was reviewing its foreign exchange trading activities, over a period of several years to August this year.
The FCA revealed last month it had launched its own investigation into the foreign exchange market, which is worth £3 trillion a day globally.
It said it first sent out letters to firms in April, before launching a formal investigation later.
Regulators are looking into whether currency traders shared information about their positions and knowledge of client orders through instant messages to rig the foreign exchange market in their favour.
Currency exchange rates are set on a daily basis by analysing actual trading volumes at leading banks during a short time window.
It is thought that traders could potentially influence exchange rates by pushing through large orders during the 60-second window to make a profit.
Even a small movement in exchange rates could affect the value of investments worldwide, including pension funds.
It threatens to engulf the industry in yet another embarrassing scandal at a time when many financial firms are still battling to restore their reputations following the Libor rigging revelations.
Barclays and RBS were both fined for their part in the Libor scandal, paying penalties of £290 million and £391 million respectively.
According to the Bank for International Settlements, global foreign exchange activity rose to 5.3 trillion dollars (£3.3 trillion) a day this year, from four trillion dollars (£2.5 trillion) in 2010.
London accounts for the bulk of currency trading, with 41% of global turnover in the market, followed by the United States, which has a 19% share, Singapore with 5.7%, Japan with 5.6% and Hong Kong with 4.1%.