Posts Tagged:LIBOR

First Libor-Based Swap Case Filed in UK

Reuters reports that Guardian Care Homes is suing Barclays over Libor-based interest rate swaps.  (Reuters)  Although it is a small claim of $59 million, it has big implications and will be watched carefully. The article has one staggering fact: Britain’s financial regulator has estimated that about 44,000 interest rate swaps have been wrongly sold to…

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Five Alabama Homeowners Sue Banks over Libor

DSNews reports that five Alabama homeowners are acting as lead plaintiffs in a Libor class action.  They owned ARMs linked to the Libor and claim to have been damaged in the $1,000 range.  The plaintiffs attorneys estimate the class could grow to over 100,000.  (DSN)  Also see an FT article on the same topic.  (FT)…

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Libor Liability Estimate Update: $6 billion

The latest liability estimate for the Libor scandal is in at $6 billion for municipal bonds, writes Darrell Preston of Bloomberg.  (Bloomberg)  The estimate comes from Swap Financial Group.  The size of the muni swap market is estimated to be about $500 billion, so the $6 billion estimate comes in at 1.2 percent.

Can Libor be Fixed?

The indefatigable Floyd Norris, writing in The New York Times, outlines the problems with fixing Libor as it exists today.  The article can be found here. While there can be no doubt that the world needs a no-risk reference rate, I doubt that Libor can be salvaged.

Libor Litigation – Part Deux

Reuters reports that a second wave of Libor litigation could be heading our way depending on how the rate is changed.  You can get the article here.  If you don’t feel like making the jump, here’s what you need to know: Major changes to the way Libor is set could trigger years of legal wrangling…

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LIBOR Scandal Becomes New Profit Center for White Collar Law Firms

Azam Ahmed of The New York Times has an great piece out in the DealBook Section about how white collar law firms are thriving, especially off of the Libor scandal.  You can find the article here.  The (literal) money quote: The global investigation into the manipulation of a crucial benchmark interest rate known as the London…

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LIBOR-Type Manipulation Possible in Many Global Indicies

Joshua Gallu of Bloomberg reports here that many of the worlds benchmarks could be subject to the same type of manipulation seen with LIBOR.  How?: Fewer than half of the benchmark interest rates surveyed in the U.S., Europe and Asia were based on actual transactions, according to a confidential International Organization of Securities Commissions discussion…

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LIBOR-Based Swaps Estimated to be $250 Trillion

The Guardian has an article which estimates LIBOR-based swaps to be $250 trillion – which is a lot of illions.  You can find the article here.  Writer Alix Bailin does a nice job describing the LIBOR setting process, which is remarkably like the Keynesian beauty contest.  Here you go: The process for ascertaining Libor is…

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Reuters – New York Fed Knew about LIBOR Fixing in August 2007

Reuters is reporting here that it is likely the New York Fed knew about LIBOR rate fixing… back in August 2007.  It then investigated Barclays in the Spring of 2008 and shared their findings with the UK regulators.

CNBC Interview with Janet Cowell, NC State Treasurer, on LIBOR Swaps

Here’s the link to the CNBC video. Madame Cowell thinks the LIBOR settlement could be bigger than the mortgage settlements.

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