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Share Price Information for Barclays (BARC)

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Share Price: 214.15
Bid: 214.45
Ask: 214.55
Change: -4.95 (-2.26%)
Spread: 0.10 (0.047%)
Open: 218.25
High: 219.50
Low: 213.60
Prev. Close: 219.10
BARC Live PriceLast checked at -

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Another 11 banks hit by LIBOR scandal

Fri, 13th Jul 2012 09:21

The LIBOR rate fixing scandal is spreading like wildfire just a few hours after it was revealed that US Secretary of the Treasury Tim Geithner wrote to the Bank of England back in 2008 regarding concerns about the possible distortion of the London Interbank Offered Rate (LIBOR) - the rate at which banks lend to each other and therefore a key reference lending rate - and its impact. Geithner made a series of recommendations to the Bank of England, including an increased regulatory vigilance and also suggested that the British Banking Association (BBA), which sets LIBOR based on data received from different financial institution, write a manual of proper bank reporting and that it should collect quotes from a number of banks, but then use a random subset in order to set the final rate. At the same time, the Financial Times reports that another 11 banks besides Barclays will also be implicated in the scandal and that total legal and regulatory costs could reach $14bn beyond 2014. According to Morgan Stanley, the fines will decrease earnings per share this year by between 4% and 13% although they feel that, if the banks cooperate, the final costs will be smaller than the amount that had to be paid by Barclays. The newspaper states that Bank of America, Citigroup, JP Morgan, Credit Suisse, UBS, Deutsche Bank, Société Générale, RBS, HSBC and Lloyds are among the banks under investigation. Furthermore, LIBOR manipulation has put global regulators on alert and many investigations have begun to examine the possibility of rigging in other rate setting processes such as the EURIBOR (European Interbank Offered Rate). German regulator BaFin has been one of the first to start investigations, according to Reuters.EU Competition Commissioner Joaquin Almunia has also revealed that he's investigating alleged rigging of LIBOR rates. "The story is quite shocking. We are focusing our investigations on suspected cartel arrangements involving financial derivatives related to these benchmark rates, including possible collusion over the setting of the rates," he said.SB
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