Landesbank Berlin Quits Euribor in Bank Exodus From Benchmarks

Landesbank Berlin AG, a German regional lender, became the sixth bank this year to stop contributing to the panel setting Euribor, adding to an exodus that includes UBS AG and Rabobank Groep.

The bank also stopped contributing to the Eonia and USD Euribor benchmarks, Euribor-EBF, the Brussels-based industry group that runs the rate, said in a statement on its website.

After three banks were fined more than $2.5 billion for rigging the London interbank offered rate and Euribor, firms are withdrawing from benchmarks amid growing concern that they may face lawsuits, fines and criminal penalties if found to have engaged in wrongdoing. Michel Barnier, the European Union’s internal market and services commissioner, said in February he was considering making lenders participate in benchmarks to preserve their integrity as market benchmarks.

“The bank probably doesn’t want to be involved in something that is getting such poor publicity, and they think it’s best we step away,” said Christopher Wheeler, a banking analyst at Mediobanca SpA in London. “I also suspect it’s reducing considerably its activity in the large wholesale interbank lending market.”

Euribor-EBF Director Cedric Quemener and Frank Weidner, a Landesbank Berlin spokesman, didn’t respond to e-mails seeking comment outside business hours.

Bayerische Landesbank, Rabobank and Raiffeisen Bank International AG (RBI) left Euribor in January. UBS, Switzerland’s biggest bank, and Svenska Handelsbanken AB (SHBA) left in March.

The euro interbank offered rate is derived from a daily survey of lending quotes conducted for Euribor-EBF by Thomson Reuters Corp. There are 36 contributors on the Euribor panel, according to Euribor-EBF’s website.

Three-month Euribor, which tracks bank-loan rates over that maturity, was little changed at 0.207 percent today, down from 0.708 percent a year earlier.

To contact the reporter on this story: Katie Linsell in London at klinsell@bloomberg.net

To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net

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