Citigroup, Deutsche, HSBC Agree to $132 Million Settlement in Libor Scandal
October 13 2017 - 2:31AM
Dow Jones News
By Maria Armental
Citigroup Inc., Deutsche Bank AG, and HSBC Holdings PLC have
agreed to pay about $132 million in total to resolve accusations
they rigged a lending benchmark, according to court documents.
The proposed settlements, pending court approval, include no
admission of wrongdoing.
In turn, the three banks agreed to cooperate with the
plaintiffs--futures traders and others that lost money because of
the alleged manipulation--in a 2011 class-action complaint filed
against leading financial institutions. The three banks are among
those the complaint was filed against.
Banks have paid billions of dollars in penalties to resolve
similar criminal and civil cases accusing them of manipulating the
London interbank offered rate, or Libor, which is calculated based
on submissions from a panel of banks.
Libor, which is being phased out, is used to set interest rates
in trillions of dollars of financial contracts, including corporate
debt and home mortgages.
According to documents filed Wednesday in Manhattan federal
court, the three banks reached the tentative agreements in July,
with Deutsche Bank agreeing to pay $80 million, Citi $33.4 million
and HSBC $18.5 million.
The money would go into a settlement fund to compensate those
who lost money because of the alleged manipulation.
A representative for HSBC released a statement saying, "We are
pleased the matter is resolved." Citi declined to comment. Deutsche
Bank couldn't be reached for comment on Thursday evening.
Barclays PLC, which reached a similar settlement agreement in
2014, has agreed to turn over lists of clients who traded
eurodollar futures during the class period, which would be expanded
to Jan. 1, 2003, through May 31, 2011.
If approved, the settlements would cover anyone who transacted
in eurodollar futures or options on eurodollar futures on
exchanges, including the Chicago Mercantile Exchange, during that
period.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
October 13, 2017 02:16 ET (06:16 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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