(Adds more detail, UBS reaction)
By Huw Jones
LONDON, March 19 (Reuters) - Britain's markets watchdog said on Tuesday it had fined Swiss bank UBS a record 27.6 million pounds for failing to report 136 million transactions properly for nearly a decade in a repeat offence.
The Financial Conduct Authority (FCA) said the failings cover reports between November 2007 and May 2017.
"If firms cannot report their transactions accurately, fundamental risks arise, including the risk that market abuse may be hidden," said Mark Steward, the FCA's executive director of enforcement.
The FCA had already fined UBS 100,000 pounds in November 2005 for transaction reporting failings.
UBS said on Tuesday it was pleased to have resolved what it called a "legacy matter", which is was fully provisioned for.
"Although there was never any impact on clients, investors or market users the bank has made significant investments to enhance its transaction reporting systems and controls," UBS said in a statement.
Under European Union securities law, banks must report transactions like stock and bond trades in a timely and accurate way so that regulators can spot any suspicious moves quickly.
The FCA said UBS failed to ensure it made proper reports on 86.67 million transactions that were required to be notified to the regulator. It also wrongly reported 49.1 million transactions to the FCA that did not require reporting.
By agreeing to a speedy settlement, UBS qualified for a 30 percent discount, thereby avoiding a bigger fine of 39.4 million pounds.
UBS is the 13th financial firm to be fined for transaction reporting failures under EU rules that came into force in 2007.
Reporting by Huw Jones, editing by Sinead Cruise and Emelia Sithole-Matarise