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Banks can no longer be trusted to set interest rates
The banking industry can no longer be trusted to set a benchmark interest rate – that lies behind trillions of pounds of mortgages, credit cards, small business loans and financial derivatives – without the supervision of government regulators, the industry's lobby group conceded yesterday. The scale of the manipulation of the London Interbank Offered Rate, or Libor, which was revealed by the twin investigations into Barclays, threatens to wreck the integrity of the measure and cause serious ripples across financial markets. The interest rate on home loans and credit cards is tied to Libor, as are the valuations ... (full story)