Mortgage News
Regulators meet banks to consider LIBOR overhaul
UK regulators and global banks are discussing an overhaul of interbank lending rates amid a probe into alleged manipulation of the benchmark.
The FT has reported Treasury officials, the Bank of England and the FSA met with financial institutions on Monday to begin a review process that may change the way LIBOR is set.
The meeting comes after allegations that banks understated borrowing costs in order to artificially suppress the lending rate.
Regulators in the US, UK and Japan have been investigating the alleged manipulation of the London Interbank Offered Rates and other benchmark price-setting rates for the past year.
Traders from a number of investment banks in Europe and the US have been suspended or placed on leave in connection with the investigation, according to the paper.
“As part of the normal reviewing processes of LIBOR, a number of contributing banks met today to consider future regulatory and market developments, such as the incoming liquidity rules, relevant to the parameters that LIBOR measure,” the British Bankers Association said in a statement to the FT.
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