More than a dozen big banks have been fingered for their role in the Libor rate manipulation scandal. Now lawmakers are turning their attention the one of the financial regulators that has spent the last few months serving much of the justice.
The U.K. Financial Services Authority, which has been doling out billions in Libor-related fines, was indirectly complicit in Barclays’ role in the scandal by not identifying or dealing with the bank’s gaps in compliance, according to a new report from the U.K.’s Treasury Select Committee.
“Serious regulatory shortcomings came to light,” committee head Andrew Tyrie noted in a statement. “It is only right that the FSA has had to shoulder its share of the blame for this scandal.”
The U.K. regulator, with the help of U.S. authorities, fined Barclays and Royal Bank of Scotland more than $2.5 billion for massaging interest rates in their favor.
Any embarrassment the FSA felt following the issuing of the report was likely compounded when a U.S. regulator acknowledged that authorities cannot yet guarantee that the rate is fraud-free, according to the BBC.
When the Libor scandal is finally put to bed, it may save time to name the organizations that weren’t complicit.
No Split (WSJ)
Citigroup Chairman Michael E. O'Neill, who as a director once pushed the firm to at least consider splitting up the bank, no longer thinks it’s a prudent move.
Go Samba (eFinancialCareers)
Insurance firms are on the lookout for senior executives based in the U.K. and U.S. to move to Latin America and tap into the region’s growth opportunities.
Moving On (Bloomberg)
Rodney Tsang, Citi’s co-head of corporate and investment banking for the greater China, left the bank yesterday. The reasoning behind the move is unclear, although Citi fell from No. 6 in arranging overseas share sales by Chinese companies in 2011 to No. 8 last year.
Who’s Really Hurting? (Financial Times)
Financial workers in London saw their total compensation increase more than 14% in the three years following the crisis. All other workers saw just a 3.7% bump in pay – a real terms loss – between 2008 and 2011.
Even Playing Field (Financial Times)
Corporate debt capital market activity, once dominated by bulge bracket banks, is becoming more competitive. As large firms downsize, mid-tier firms are gaining market share.
One Winner (eFinancialCareers)
Brazilian bank BTG Pactual increased its proprietary trading revenues in 2012 by a jaw-dropping 3,771% while larger banks closed their prop trading businesses.
No Help (Bloomberg)
If regulators want to get to find out which unknown traders participated in suspicious trading of Heinz shares, they’ll need more than Goldman Sachs’ help. The bank, which reportedly held the account in question, told regulators that it does not have “direct access” to information about the owner of the account, saying that it only knows that it is a Zurich private wealth client.
Shuttering (Financial News)
Benros Capital, an event-driven hedge fund set up by ex-Goldman staffers Daniele Benatoff and Ariel Roskis, is set to close after its main backer, Brummer & Partners, decided to pull its investment.
Buzz Around the Office
Awe-Inspiring Philanthropy (WTAE.com)
For 32 years, humble-living shoe-shiner Albert Lexie has donated all his tips to helping sick kids. So far he’s raised roughly $200,000 for the Children’s Hospital Free Care Fund, more than one-third of his lifetime salary. Well done, Albert.
List of the Day: Office Gossip
Office gossip may pass the time, but passing rumors will never do any good for your career. Here’s how to avoid getting involved.
- Walk away from conversations that begin ‘have you heard.’
- Don’t repeat something unless it’s fact, or you’re told to.
- Steer clear of the water cooler gang.