A guide to the Libor scandal and benchmark reform

Author: | Published: 12 May 2014
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When Barclays reached a $453 million settlement with regulators in June 2012 over allegedly manipulating the London Interbank Offered Rate (Libor), it could not have expected the global ramifications that followed.

Since then, more than a dozen other banks have been implicated on the scandal. Some have reached much larger settlements with regulators, while some have been sued in private actions. Its administrator has been replaced, as will the rate-setting methodology.

But not all has been decided yet, and IFLR will be tracking the developments which redefine the world’s most relied upon benchmark rate.

Here is all you need to know about the Libor scandal and its ramifications.

Libor

OPINION: why NYSE Euronext might not solve the Libor problem Professor Justin O'Brien is Director of the Centre for Law, Markets and Regulation at the University of New South Wales, assesses the benchmark’s new overseer

How regulators plan to curtail rate-setting opt-out Regulatory compulsion is shaping up as a key battleground in benchmark rate reform, as more banks quit rate-setting panels.

Market poll: who should oversee Libor Many believe multiple administrators is the answer to improving the troubled benchmark

Wheatley’s Libor Review: what will it achieve? Questions as to whether criminal sanctions for manipulating the rate will have retrospective effect dominated the immediate market reaction to Wheatley’s Libor Review

Wheatley correct to scrap A$ Libor Phasing out Australian dollar rates from the benchmark is the right decision, as Australia’s bank bill swap reference rate is the dominant reference in the country’s financial contracts

DPAs possible for Libor charges White collar prosecutors received a new enforcement tool following the Ministry of Justice's consultation on deferred prosecution agreements

How to make Libor work In the wake of Barclays’ settlement, the market reviews what aspects of the benchmark must change

Morgan Stanley: BoE must administer Libor For the replacement to be effective, a less transparent rate-setting methodology would be required

CFTC chairman outlines Libor alternatives Interbank lending rates may no longer be a suitable input for financial benchmarks, said Gary Gensler, then chairman of the US Commodity Futures Trading Commission

US banks fight back of Libor accusations Class action lawsuits before US courts argue international banks colluded at the expense of investors, community banks, municipalities and investment funds

What TSC Libor report means for London’s reputation The Treasury Select Committee’s preliminary report on fixing the benchmark in August 2012 called for reform in several areas of the UK banking sector

Deutsche Bank Libor settlement signals harsher penalties The German bank is the latest to settle with US regulators

Global regulatory enforcement post-Libor Since the scandal broke, financial institutions are increasingly being deputised to police themselves 

Asic warns banks to cooperate with BBSW The chair of Australia's securities regulator warned the market to stop delaying its investigations 

ISDAFix

The biggest scandal yet   Barclays' recent penalty for manipulating the benchmark will be the first of many imposed on the banking sector

The biggest scandal yet TheUS CFTC and UK FCA have all been investigating whether yet anotherinternational market benchmark, known as the ISDAFix, has been manipulated overseveral years

Injured investors Swapsbenchmark ISDAFix impacts markets twice the size of Libor. It's problems couldhave massive ramifications for those implicated and investors, and warrantgreater attention

Other benchmarks

Benchmark under scrutiny Investigations of alleged oil manipulation highlight the challenges of overseeing cross-border oil price benchmarks

Mibor use limits reform impact India has become a global leader in reforming its interbank offered rate. It would be helpful if the rate was used more frequently

FCA's Wheatley: lawyers must engage in forex principles The profession must be part of the debate, rather than focus on brightlines

 


 

 

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