Under the agreement AFD would provide a soft loan for the project for a period of 20 years, including a grace period of six years at an interest rate of six-month Euro interbank offered rate
(Euribor) with a spread of 52 basis points.
The UK Serious Fraud Office (SFO) alleges they conspired with others at Barclays, Deutsche Bank, Societe Generale and other banks to defraud by rigging Euribor, the Euro interbank offered rate
, for profit.
The accused - six from Deutsche Bank, four from Barclays, and one from Societe Generale - are the first to face criminal proceedings as a result of an investigation by the Serious Fraud Office (SFO) into the alleged manipulation of the Euro Interbank Offered Rate
British authorities have said they will charge 10 bankers with manipulating the Euro Interbank Offered Rate
Superintendent of Financial Services Benjamin Lawsky noted that "Deutsche Bank employees engaged in a widespread effort to manipulate benchmark interest rates for financial gain." A number of the employees involved in misconduct have already left the bank, he said, yet those that remain are "being terminated or banned from the New York banking system." The manipulation of the benchmark interest rates included the London Interbank Offered Bank ("LIBOR"), the Euro Interbank Offered Rate
("EURIBOR") and Euroyen Tokyo Interbank Offered Rate ("TIBOR") (collectively, "IBOR").
These products are traded worldwide and play a key role in the global economy, while they derive their value from the level of a benchmark interest rate, such as the Euro Interbank Offered Rate
(EURIBOR) for the euro.
The senior tranche of Avoca Capital CLO X Limited is priced at 140 basis points above the Euro Interbank Offered Rate
, which is one of the tightest spreads in the European CLO market.'
This first exchange of views comes in the wake of the London Interbank Offered Rate (Libor) and the Euro Interbank Offered Rate
(Euribor) scandals, and after the US fined Dutch bank Rabobank over US$1 billion last week for its involvement in rigging benchmark interest rates.
The European Commission is tipped to slap six of the world's biggest banks with fines for the manipulation of one of the world's most important interbank lending rates - Euro Interbank Offered Rate
The FSA said UBS had routinely sought to manipulate submissions to calculate Libor and the Euro Interbank Offered Rate
and (Euribor), to make its trading positions more profitable and give the appearance the bank was on a stronger financial footing as the financial crisis began unfolding in 2007.
The difference between the euro interbank offered rate
and overnight index swaps, known as the Euribor-OIS spread, was 14.4 basis points at 8:25 a.m.