6.5.2011
By Simon Miller
Royal Bank of Scotland (RBS) has become the second UK bank to confirm that it is assisting US and European regulators investigating allegations of interest rate manipulation.
In its Q1 interim report, RBS noted that the US Commodity Futures Trading Commission, the US Securities and Exchange Commission and the European Commission are conducting investigations into the submissions of various Libor rates by relevant panel banks.
It added: “As a panel bank in each instance, RBS Group is co-operating with these investigations and is keeping other relevant regulators informed.”
In its interim report released at the end of April, Barclays Bank confirmed it was assisting with inquiries relating to “certain past submissions made by Barclays to the British Bankers’ Association, which sets LIBOR rates”.
Both banks noted they were uncertain as to what effect investigations and any related development may have on the banks.
The banks’ admission comes after a Vienna hedge fund filed a lawsuit in New York federal court alleging it was harmed in the derivatives market when some of the world's biggest banks manipulated a key benchmark dollar interest rate.
Credit Suisse, Bank of America Corp., J.P. Morgan Chase, HSBC, Barclays, Lloyds, WestLB, UBS, RBS, Deutsche Bank, Citigroup and Norinchukin Bank were named in the suit.
In March Swiss bank UBS confirmed it had received a subpoena from US regulators investigating Libor manipulation in its annual report.
"UBS understands that the investigations focus on whether there were improper attempts by UBS, either acting on its own or together with others, to manipulate Libor rates at certain times," said the Swiss bank.
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