Wall St bank JPMorgan Chase has been fined a total of £570m ($920m) over the £3.7bn "London Whale" trading losses.
The penalties include £137.6m ($221m) imposed by the Financial Conduct Authority (FCA) - the second-biggest in the UK City watchdog's history behind the fine levied against UBS for the Libor-rigging scandal last December.
The rest will be paid to the US Office of the Comptroller of the Currency, the Federal Reserve and Securities and Exchange Commission.
The regulators' penalties focus on failures in risk management and financial reporting systems.
JPMorgan was also cited for failing to tell its board of directors and regulators about deficiencies in its risk management systems that had been identified by management.
The settlement covers only civil liabilities in the case The "London Whale" involved a London-based trader, Bruno Iksil, who racked up billions of pounds of bets on derivatives products which turned sour, and which were then concealed from the bank's top management by several colleagues who have since been fired.
Two men - Julien Grout and Javier Martin-Artajo - have been charged in the US with conspiracy and fraud for allegedly covering up the trading losses.
Mr Iksil has been told he will not face charges.
Tracey McDermott, the FCA's director of enforcement and financial crime, said: "Maintaining the integrity of markets is a key part of our wholesale conduct agenda.
"We consider JPMorgan's failings to be extremely serious such as to undermine the trust and confidence in UK financial markets.
"There were basic failings in the operation of fundamental controls over a high-risk part of the business.
JPMorgan CEO Jamie Dimon is reforming the bank's controls "Senior management failed to respond properly to warning signals that there were problems in the CIO (Chief Investment Office).
"As things began to go wrong, the firm didn't wake up quickly enough to the size and the scale of the problems.
"What is worse, they compounded this by failing to be open and co-operative with us as their regulator."
Jamie Dimon, JPMorgan's chairman and chief executive, apologised for having initially dismissed the affair as "a tempest in a teapot" and this week announced significant changes to the firm's compliance and risk management functions, including the hiring of thousands of additional employees.
The bank has also clawed back millions of dollars in bonuses from employees over the trading losses.
It is the latest in a series of regulatory blows to hit Mr Dimon, lauded as the most successful banker on Wall Street for having stewarded JPMorgan through the financial crisis.
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