The British banking world in particular suffered considerably in the wake of the crisis. For years, Great Britain has had one of the least regulated financial markets in the world and during the crisis there was more than one project in this world that had problematic consequences for the banks. The scandal surrounding the interbank interest rate Libor, which was apparently manipulated by various banks and individuals, became particularly well-known. Now the British banking regulator has decided to outsource control to an American stock exchange community.
The scandal with the interbank interest rate Libor
It took a major financial crisis for various mechanisms on the financial markets to come to light. The investigation by the regulatory authorities in Europe also brought to light a suspicious mechanism surrounding the Libor interest rate, the interest rate for trading between different banks. It seems as if various big players on the market have circumvented the control mechanisms and enriched themselves through targeted agreements on interest rates. The investigation in this area is still ongoing – but prominent institutions in Europe have already been asked to pay up by the British government. Barclay Bank and the Royal Bank of Scotland had to pay back a total of around 2.5 billion euros to the state. As a consequence of the banks’ actions, state control has now been outsourced to America.
NYSE takes over control and processing of Libor
The British Bankers’ Association is now interested in restoring the reputation of Libor and has therefore handed over control to another market. After all, Libor is still an important base rate for mortgage transactions and covers values in the trillions. The NYSE, the New York Stock Exchange, is taking over control and administration of Libor and is thus intended to prevent manipulation in the future. You can find out what effects this has on small investors and traders at Plus500Erfahrungen.net. The NYSE is not only taking control of the interest rate itself, but also of the various transactions that are directly linked to Libor. In this way, the trust of banks and authorities in the actually so important base rate is to be restored. Whether this will work will probably only become clear in a few years.
