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The London Inter-Bank Offered Rate (Libor / ˈ l aɪ b ɔː r / LY-bor) [a] was an interest rate average calculated from estimates submitted by the leading banks in London. Each bank estimated what it would be charged were it to borrow from other banks. [1] [b] It was the primary benchmark, along with the Euribor, for short-term interest rates ...
(Bloomberg Opinion) -- When it comes to overseeing Wall Street, regulators must know that if they give an inch, banks and other large financial institutions will take a mile.That’s part of the ...
(Bloomberg Opinion) -- The overseers of three-month dollar Libor are considering a stay of execution for the benchmark interest rate for trillions of dollars’ worth of securities that was ...
The Libor scandal was a series of fraudulent actions connected to the Libor (London Inter-bank Offered Rate) and also the resulting investigation and reaction. Libor is an average interest rate calculated through submissions of interest rates by major banks across the world.
The TED spread is an indicator of perceived credit risk in the general economy, [2] since T-bills are considered risk-free while LIBOR reflects the credit risk of lending to commercial banks. An increase in the TED spread is a sign that lenders believe the risk of default on interbank loans (also known as counterparty risk ) is increasing.
Tom Hayes (born October 1979 [1]) is a former trader for UBS and Citigroup who was convicted for conspiracy to defraud and sentenced to 14 years in prison (reduced to 11 years on appeal) for conspiring with others to dishonestly manipulate the London Interbank Offered Rate [2] as part of the Libor scandal.
3-month LIBOR is generally a floating rate of financing, which fluctuates depending on how risky a lending bank feels about a borrowing bank. The OIS is a swap derived from the overnight rate, which is generally fixed by the local central bank. The OIS allows LIBOR-based banks to borrow at a fixed rate of interest over the same period.
The PCBS found that "Libor [was] being manipulated for years." [ 10 ] Closing the proceedings, Andrew Tyrie told the UBS executives that "You were ignorant and out of your depth." [ 11 ] [ 12 ] Huw Jenkins stated in his testimony that "It [Libor fixing] was a very engrained part of the business areas, so it would not surprise me if it was going ...