April 2 (Bloomberg) -- The British Bankers’ Association, the lobby group that oversees Libor, said it will delay publishing banks’ individual submissions by three months in an effort to restore confidence in the benchmark rate.
Individual entries of the lenders that contribute to the London interbank offered rate each day in different currencies and maturities will no longer be made available on the same day from July 1, the London-based BBA said in a statement today. Libor will also no longer be published on U.K. bank holidays.
The measures were ordered by Martin Wheatley, the U.K. regulator charged with overhauling the global benchmark rate, after banks around the globe admitted to low-balling their submissions during the financial crisis to appear healthier than they were. Barclays Plc was fined 290 million pounds ($439 million) in June for rigging Libor, prompting senior executives including Chief Executive Officer Robert Diamond to resign.
“We believe these changes taken together reflect our commitment to meeting the absolute priority for everyone involved in this process, from users to regulators,” BBA CEO Anthony Browne said in the statement. They’re a “provision of a reliable benchmark which has the confidence and support of all users.”
Libor, a benchmark for more than $300 trillion of financial products worldwide, is calculated by a poll carried out daily on behalf of the BBA that asks firms to estimate how much it would cost to borrow from each other for different periods and in different currencies. The top and bottom quartiles of quotes are excluded, and those left are averaged and published for individual currencies before noon in London.
The U.K. government is preparing to select a new operator for Libor.
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