(0300 GMT).Ī settlement rate for NDF contracts due to expire is then calculated by taking the average of the submissions, excluding the highest and lowest quarters of contributions from the banks. Under the NDF rate-setting process, organised by the Association of Banks in Singapore (ABS), banks submit their reading of the spot price for the Indonesian rupiah, Malaysian ringgit and Vietnamese dong every working day at 11:00 a.m. Twelve said they had no comment while two did not respond to repeated telephone and e-mail requests for comment. Reuters also contacted the other 14 banks involved in setting NDF rates. UBS, JPMorgan, DBS and HSBC declined to comment. The source did not make specific comments about possible wrongdoing by individual banks or traders and Reuters has no independent evidence of such wrongdoing. The biggest banks in the Asian NDF markets include UBS, JPMorgan Chase & Co JPM.N, DBS Group Holdings Ltd DBSM.SI and HSBC Holdings Plc HSBA.L. The Singapore bank probes show that the focus is now turning to other benchmarks, amid concern that they too were manipulated. Regulatory probes stemming from the Libor cases in the United States and Britain have also revealed evidence of attempted manipulation of benchmark interbank lending rates in Tokyo, Hong Kong and Australia.īanking watchdogs in Britain and elsewhere in Europe have begun trying to reform the way Libor and other interbank rates are set, to try to ensure the numbers can’t be manipulated. The investigations into Libor led to fines of $1.5 billion for UBS AG UBSN.VX and $451 million for Barclays Plc BARC.L for rate rigging.
7 DAYS TO DIE TRADER PRICES CRACKED
and British regulators cracked down on manipulation of the London interbank offered rate (Libor), a benchmark used to set interest rates for around $600 trillion (381.33 trillion pounds) worth of securities. The Monetary Authority of Singapore ordered banks that help set local interbank lending rates and NDF rates to review the fixing process last year as U.S.
The contracts are settled in dollars, so there is no exchange of the underlying currency, but they can affect spot exchange rates.
NDFs are derivatives that let companies and investors hedge or speculate on emerging market currencies when exchange controls make it difficult for foreigners to participate directly in the spot market. “Traders were talking to traders, saying: ‘I need you to help me today, I need to fix low,’” said the bank source, who asked not to be identified due to the confidential nature of the reviews. The probes found evidence showing that traders from several banks communicated with each other over electronic messaging about what rates they were going to submit for the local banking association’s fixings for non-deliverable foreign exchange forwards (NDFs), aiming to benefit their trading books. The discovery widens a global lending rate scandal into new markets, as fallout from the Libor case puts banks under added scrutiny and spurs both regulators and institutions to reconsider how certain key interest and currency rates are set. SINGAPORE (Reuters) - Internal reviews by banks in Singapore have found evidence that traders colluded to manipulate rates in the offshore foreign exchange market, according to a source with knowledge of the inquiries.
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