FRANKFURT (Reuters) - Europe’s banking authorities are throwing a wide net as they work on checks to see whether banks have been manipulating Euribor, the euro-priced counterpart of scandal-hit Libor bank-to-bank lending rates.
With more than a dozen banks under investigation in Europe, Japan and the United States over suspected rigging of the London interbank offered rate (Libor), a key interest rate used in contracts worth trillions of dollars, authorities are now looking into whether malpractice could have happened elsewhere.
According to several people familiar with the matter, German banking supervisor BaFin is now looking into Euribor, the main gauge of euro-priced lending compiled from 43 banks by the Brussels-based European Banking Federation (EBF).
Eight German banks provide data on their funding costs for Euribor, Deutsche Bank (DBKGn.DE), Commerzbank (CBKG.DE), DZ Bank DGBGg.F, LBBW LBWGga.F, BayernLB BAYLB.UL, Helaba HLHTG.UL, NordLB NDLG.UL and Landesbank Berlin BEBGL.UL.
(For list of banks contributing to Euribor figures, click on: here)
BaFin declined to comment, but one well-placed source said the supervisor’s audit was currently not even halfway through. They added that so far “BaFin has no concrete evidence that German banks have attempted to manipulate Euribor.”
The EBF has offered to provide “full disclosure” to authorities looking into any rate fixing and has said it would like European supervisors to oversee its work.
ThomsonReuters, which computes and publishes the data collected by the EBF, said it would fully cooperate with authorities if contacted.
The European Commission has a separate probe running into suspected Euribor fixing which last year saw it raid a number of banks, including Deutsche Bank.
Britain’s Serious Fraud Office has started a criminal case on Libor fixing, but has not indicated that it is also looking into Euribor rates.
Reporting by Marc Jones, Arno Schuetze and Philipp Halstrick