Guess what percentage of companies actually reward staff for innovation…August 31, 2015 3:16
Citigroup To Exit UAE Interbank Rate Setting Panel
June 10, 2013 12:14 by Reuters
U.S. lender Citigroup will leave the interbank interest rate setting panel in the United Arab Emirates on June 25, reducing the size of the panel to 11 banks from 12, the central bank said on Monday.
The move will further increase the dominance of local banks over foreign banks in the panel that determines the Emirates interbank offered rate (Eibor), which is used to price financial instruments in the Gulf’s top banking centre.
A spokesman for Citi declined to comment on the reasons for its withdrawal when contacted by Reuters. The central bank said the exit was in line with Citi’s “globally implemented policy”.
Since last year’s scandal over manipulation of the London interbank offered rate (Libor), banks around the world have been considering withdrawing from panels which set indicative interbank rates, questioning the benefits of participation given the potential risks to their reputation.
Last year Barclays agreed to pay a $453 million fine to U.S and British regulators over Libor manipulation, and last October it withdrew from the Eibor panel, though there was no suggestion that it tried to manipulate Eibor.
Barclays was replaced by UAE lender National Bank of Fujairah, but Citi will not be replaced. That will leave nine local and two foreign banks – HSBC and Standard Chartered – in the panel.
The central bank also said on Monday that the two-month Eibor tenor would be dropped from the panel’s fixings, effective on Dec. 10. Eibor rates run from one week to one year.
A banker familiar with Eibor, who declined to be named, said the two-month tenor was being dropped because it was rarely used. Citi’s exit from the panel is unlikely to affect rates significantly, he said.
The central bank said the next meeting of the Eibor panel would discuss governance standards in line with recommendations by the Bank for International Settlements.