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Banks are on the brink as MPs and peers get ready to reveal controversial shake-up
There will be much more to the banking commission’s long-awaited report than the debate on whether RBS should be split in two. Controversial recommendations could include tough punishments for errant bankers, including bans on acting as a director or even jail terms. The commission of MPs and peers – not to be confused with the earlier Independent Commission on Banking (ICB) – was set up by George Osborne in the slipstream of the Libor rate-rigging scandal of last summer and is due to deliver its final report later this month. Led by the formidable Andrew Tyrie, its report into culture and standards in the banking industry is likely to contain some thorns in the side for the Chancellor. It will also be deeply uncomfortable for City regulators and bank auditors as well as the discredited lenders themselves. We have already seen its blistering inquiry into the downfall of HBOS......Read more here-
#15corpio commentedEditing a commentLibor change aims to prevent rigging scandal repeat. A banking industry body is to change how the key Libor interest rate is set, in order to avoid a repeat of last year's rigging scandal. The British Bankers' Association (BBA) said publication of banks' individual submissions would be embargoed for three months to avoid "manipulation". The Libor rate is used to set trillions of dollars of financial contracts, including many mortgages. The change, after a review by the government, will start on 1 July. The bank submissions will "remain available in real-time to the Libor benchmark administrators, for the purposes of calculating the rate and for monitoring and surveillance". However, individual banks will no longer be able to see each others' estimates of their borrowing costs - which are used to calculate Libor - on the day of submission. Last year, Barclays was fined £290m ($454m) by British and US regulators for manipulation of Libor and Euribor interbank rates between 2005 and 2009....Read more HERE
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