Topic
Libor (London interbank offered rate), is meant to represent how much banks pay to borrow from one another. It is also a benchmark for at least US$550 trillion worth of contracts spanning interest rate derivatives to residential mortgages. A scandal erupted after banks were found to be rigging the system. Barclays was fined US$453 million by global regulators in June 2012 for manipulating Libor, and UBS was hit with a US$1.5 billion bill in December 2012. In February 2013, RBS was fined US$612 million to settle US and UK regulatory charges of misconduct, manipulation, attempted manipulation and false reporting of yen, Swiss franc and dollar-denominated Libor.
- Wide interest-rate gap to keep stoking carry-trade arbitraging, pressuring the local currency value in the short term: Daiwa
- Return of funds from mainland China will soften the blow, and investors can expect a recovery in the second half, analyst says
Kenyan President William Ruto said during his campaign he would not go ‘anywhere near restructuring debt’, but his transport secretary nominee says current terms are not favourable and the country is ‘choked by loans’.
Lenders must act fast to migrate more than US$200 billion of legacy financial contracts referencing the scandal-ridden Libor rates. The first deadline on December 31 looms.
Companies that have currency swaps with banks face a tough call on which interest rate benchmark to use as Libor is phased out by end-2021.
The US Federal Deposit Insurance Corporation (FDIC) has sued HSBC, Citigroup, Deutsche Bank and 12 other big global banks for manipulating the Libor benchmark interest rate.
European Union antitrust regulators fined six financial institutions including Deutsche Bank, Royal Bank of Scotland and Citigroup a record total of €1.71 billion (HK$18 billion) for rigging financial benchmarks.
Britain's leading prosecutor, the Serious Fraud Office, is poised to charge more individuals in connection with a global investigation into the Libor interest-rate-rigging scandal.
Evidence that interdealer brokers at ICAP conspired to rig Libor for a bank trader raises questions over such firms' role as honest go-betweens among banks and highlights the pressure customers can put on them.
The company behind the New York Stock Exchange will take over running and restoring confidence in the scandal-hit London interbank offered rate, or Libor, a British committee has ruled.
Prosecutors allege he conspired with employees from banks - including HSBC, UBS, Citigroup, Deutsche Bank, JPMorgan Chase and Rabobank - and three interdealer brokers - ICAP, Tullett Prebon and RP Martin - to manipulate rates.
Royal Bank of Scotland's Japan brokerage unit head is preparing to resign as the company faces penalties for attempts to manipulate benchmark interest rates, according to two people with knowledge of the situation.
In the report, commissioned by the bank after it was fined £290 million (HK$3.4 billion) in June for manipulating Libor, Rothschild vice-chairman Anthony Salz criticised Barclays for failings in its culture.
Barclays said it would "reduce headcount by at least 3,700 across the group, including 1,800 in the Corporate & Investment Bank and 1,900 in Europe Retail and Business Banking". Barclays employs 140,000 staff.
More than a dozen traders at RBS offices in London, Singapore and Tokyo manipulated the London interbank offered rate, which is used to price trillions of dollars worth of loans, from at least 2006 until 2010.
The HKMA said on Thursday that it would probe Swiss banking giant UBS over claims of possible rigging of Hong Kong’s interbank offered rate (Hibor).
