* Watchdogs to forge global guidance on benchmarks
* Energy market benchmarks likely to be eyed too
* CFTC's Gensler, FSA's Wheatley to lead task force
By Huw Jones
LONDON, Sept 14 Global securities regulators are
to study how the interest rate Libor, which was rigged by
British banks including Barclays, and other money
market benchmarks should be supervised and how they are set, to
restore market confidence.
Barclays, hit with a record fine of more than $450 million
in June, is widely expected to be the first of several banks
punished for attempting to manipulate Libor - the London
interbank offered rate.
It is the price at which banks say they could borrow from
each other and is used as the basis for pricing about $350
trillion of products including some home loans and credit cards.
The Madrid-based International Organisation of Securities
Commissions (IOSCO) said on Friday the board level taskforce
will be headed by Martin Wheatley, managing director of
Britain's Financial Services Authority, and Gary Gensler,
chairman of the U.S. Commodity Futures Trading Commission.
"Benchmarks in use across global financial markets
constitute the very foundation of free, fair and transparent
market transactions, and doubts over their integrity and sound
operation must be removed," IOSCO chairman Masamichi Kono said.
The taskforce will publish a consultation report by early
2013 identifying "relevant benchmark-related policy issues and
develop policy guidance and principles for benchmark related
activities", IOSCO said in a statement.
It will look at enforcement powers, information sharing
among regulators and sanctions regimes.
IOSCO members, which include top regulators from across the
world, are required to implement the body's guidance and
principles as a condition of membership.
Wheatley is due to publish his own recommendations for
reform of Libor governance and setting on Sept. 28.
Other benchmarks IOSCO will look at are likely to include
those for pricing oil.
The inclusion of a top U.S. regulator as co-chair of the
IOSCO taskforce will help reassure the United States whose
officials have criticised Britain for failing to heed their long
standing concerns about the way Libor is set.
Libor is not directly supervised by regulators in Britain
but is overseen by its sponsor, the British Bankers' Association
Wheatley was expected to recommend direct supervision of
Libor, scaling back the number of its variants, and the
introduction of safeguards into how it is set.
Thomson Reuters, parent company of Reuters, has been
calculating and distributing the rates for the BBA since 2005.