“Europe’s top financial regulator said he’s considering forcing banks to participate in setting Libor and Euribor rates after lenders including Citigroup Inc. and HSBC Holdings Plc pulled out of some panels amid the rigging scandal.
Regulators will draw up a list of lenders that should be forced to participate in the setting of interbank rates “in view of their involvement” in those markets, Michel Barnier, the EU’s financial services chief, said in an e-mailed statement today.
“Any banks considering withdrawing from the contributing panels should therefore take into account that they may be required to rejoin,” Barnier said. The plans to force banks to submit data for rate setting will be included in draft legislation on benchmark setting that the European Commission will present in the first half of this year.
Euribor-EBF, the group that administers the setting of Euribor rates warned last month that it may face an Exodus of banks from its rate-setting panel. Rabobank International, the biggest Dutch savings bank, withdrew from the panel that sets the euro interbank offered rate in January, while Deutsche Bank AG said this week that it would end participating in some Euribor-EBF rates.
