FSA to suggest scrapping LIBOR - reports

The Financial Services Authority (FSA) will today suggest scrapping LIBOR and replacing it with a borrowing rate based on actual trades, it has been reported.

Following the recent LIBOR scandal, which has already seen Barclays fined £290m by US and UK regulators for manipulating the rate, the regulator will today set out a package of proposals designed to restore trust, the Financial Times reports. One of these will be to scrap the current system, replacing it with a borrowing rate based on actual trades, which could be overseen by a new independent body instead of the British Bankers' Association. Meanwhile, it will also consider introducing criminal sanctions for Libor manipulation, although it will makes clear this would be difficult to ...