Scandal That Cost Barclays Chairman His Job Threatens To Spread

Every day at 11 a.m., a few big banks tell the British Bankers’ Association what it costs them to borrow. Out of that comes LIBOR — the London Interbank Offered Rate, a dull but vital interest rate that underpins trillions of dollars of transactions globally, from home mortgages and personal credit cards to major corporate lending.

Now it turns out that at least some of those same banks may have been trying to manipulate the numbers to gain a small edge in the market — an edge that might win them a few tens of thousands of dollars, while driving up borrowing costs by billions for consumers and businesses around the world.

Marcus Agius, the chairman of British banking giant Barclays, announced his resignation Monday over the scandal, and the bank paid a $453 million fine. Barclays emails show traders agreeing to manipulate the numbers they reported almost casually. The United Kingdom is launching an investigation, and regulators elsewhere in Europe and in the United States have inquiries of their own into Barclays and other big banks.