Beijing, June 14 (China Economic Net) - According to a Reuters report, a survey by Moneywise magazine shows that Barclays has been named the least trusted bank in the UK, with 80% of consumers expressing dissatisfaction, a proportion more than double that of the Royal Bank of Scotland, which ranks second. Regarding the reasons for this lack of trust, many respondents indicated that Barclays' Libor manipulation scandal last year was one of the reasons they no longer trust the institution.
Chronology of the Barclays Libor Manipulation Scandal
Libor refers to the London Interbank Offered Rate. Libor was officially launched on January 1, 1986, and subsequently became the primary basis for calculating interest in lending activities within the London financial market, further evolving into a universal reference rate for global lenders and bond issuers. It is currently the most important and commonly used market interest rate benchmark internationally.
Due to financial regulatory issues, as early as the end of 2010, U.S. regulators launched investigations into the manipulation of Libor by several large financial institutions. Since then, regulators in Europe, Canada, Japan, and other regions have also launched related investigations.
On June 27, 2012, following an investigation by the U.S. Commodity Futures Trading Commission (CFTC), Barclays admitted that between 2005 and 2009, its traders attempted to manipulate and falsely report Libor and the Euro Interbank Offered Rate (Euribor) to increase profits or reduce losses in derivative transactions. Consequently, Barclays was fined over $400 million by the CFTC, the U.S. Department of Justice, and the UK Financial Services Authority.
The CFTC stated that Barclays traders frequently and widely attempted to manipulate and falsely report these two benchmark rates to either increase profits or reduce losses in derivative transactions. Furthermore, Barclays traders also persuaded other institutions to join in manipulating these two benchmark rates.
On June 30, 2012, the UK government announced that it would conduct a re-examination of Libor. Bank of England Governor Mervyn King stated that Libor requires a "thorough reform."
On July 2, 2012, Barclays Group Chairman Marcus Agius announced his resignation but would remain in office until a successor was confirmed. In his resignation statement, he said: "This scandal reflects unacceptable standards of behavior within Barclays, and it has dealt a devastating blow to Barclays' reputation."
On July 3, 2012, Barclays Group CEO Bob Diamond announced his resignation, effective immediately. In his resignation statement, he said that external pressure posed a risk of causing damage to Barclays, and he hoped his resignation would prevent this possibility. On the same day, Barclays Group Chief Operating Officer (COO) Jerry del Missier also announced his resignation.
Barclays Bank in China
On December 21, 2015, the Shanghai branch of Barclays Bank, the third-largest financial group in the UK, officially opened. This marked the group's first entry into the Chinese market. Since then, Barclays Bank has been able to provide customers with more financial products and services in more areas through its Shanghai branch. These products and services include: G7 currency markets, G7 foreign exchange trading, credit rating consulting, risk management advice, and debt financing.
In August 2008, approved by the China Banking Regulatory Commission's "Approval regarding Xinhua Trust Co., Ltd.'s absorption of capital from Barclays Bank PLC and adjustment of equity structure," the company increased its capital to 621.12 million yuan in January 2009. Barclays Bank PLC holds a 19.50% stake in Xinhua Trust, becoming its second-largest shareholder. Currently, Xinhua Trust is mired in significant risks, with its real estate projects facing a 2 billion yuan redemption pressure.
