Libor scandal rocks banking

Synopsis

The LIBOR rate rigging scandal significantly impacts the world of Finance, leading to investigations of several banks and hefty fines. Notably, Bob Diamond, the former chief executive of Barclays, resigns amid the fallout. The scandal highlights broader issues within the banking sector, including the mis-selling of complex derivatives and IT system failures. Philip Auger, a former investment banker and author, and Patrick Jenkins, the FTS banking editor, discuss the need for structural and cultural reform in banking. They emphasize that the LIBOR scandal is not just a UK issue, as similar problems arise in the United States and Japan, including insider trading scandals. The conversation raises questions about the necessity of a full-blown inquiry into the banking sector, with Philip suggesting that more questions need to be asked, while Patrick expresses skepticism about the effectiveness of such inquiries.