Libor Trap: Banks Want Out But Regulators Won't Let Them Leave - ForbesQuicklink submitted by Mari Eliza Permalink
|Banks have created a Libor monster they can't escape.
After going unregulated for decades of its existence the Libor rate is soon to be under the supervision of UK authorities. That isn't sitting well with some banks involved in the Libor-setting process, and they're apparently asking to be relieved of their duties.
Several banks have sent letters to the British Banking Authority, the trade organization that was in charge of Libor from the start, about their plans to leave the panel, according to a report in the Journal. The report says France"s BNP Paribas and the Netherlands" Rabobank Group are among the banks planning to leave.
Not so fast though. The top UK regulator who last year proposed a plan that would strip the BBA's role in overseeing Libor is warning banks against leaving.
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