Europe seeks to strip London of Libor control

London could lose control to Paris of the scandal hit interbank lending rate Libor if European authorities get their way.
A draft regulation would move oversight of the benchmark from London to the Paris based financial markets regulator, the  European Securities and Markets Authority (ESMA), reports Portfolio Advisor.

Global benchmark

The wide-ranging European Commission proposal would allow ESMA to oversee and authorise a range of  key financial benchmarks at a European level, including Libor. According to a EC spokesperson: ‘As Libor is a global benchmark, and it’s used throughout the EU in contracts, it makes sense for the supervision to reflect that reality and thus have a European dimension, and responsibility for the relevant European supervisory body.’