Tuesday, August 09, 2016
Here is a $100 million blow to a bank's reputation. Barclays has been paying out because of its participation in the LIBOR bid rigging scandal. Chances are the penalty won't change its perception among consumers, but among governments and businesses, it has a bad name and deep pockets. The fine and restitution are meant to burn into the bank's DNA that some behavior is well out of bounds. Fixing the LIBOR rate in order to skim profits was clearly illegal. This $100 million adds to billions banks have already paid for the errant action. Barclays is fortunate it wasn't more. One wonders how financial institutions fall into such behavior and tolerate it for years. Surely the bank's traders knew what they were doing and their supervisors knew as well. From a PR perspective, there is no excuse the bank can give to lessen its culpability.