Not only has the London Interbank Offered Rate been in the news; its Danish equivalent has also been the subject of a recent regulatory investigation.

The Danish Financial Supervisory Authority reported recently that it had carried out an investigation of Copenhagen Interbank Offered Rates in the period from 2009 to 2012. The investigation was based on internal documents provided by Danish Cibor-quoting institutions.

The regulator looked at the following.

• Documents concerning the governance structure of the institutions in relation to the Cibor rate, including procedures, internal controls and incentive earnings.
• Data and sensitivity calculations of the exposure of the institutions to Cibor-related products.
• Internal and external correspondence, including letters, emails, chat messages and recorded telephone conversations regarding Cibor re-ports and quotes.

In its review of the institutions’ internal documents regarding Cibor-setting, the Danish FSA found neither documentary evidence of law-breaking nor evidence of 'activities of a manipulative character'. Therefore, as a result of the investigation, the Danish FSA found no reason to tell the Danish Competition and Consumer about offences against the Competition Act or to tell the Public Prosecutor for Serious Economic and International Crime about any financial offences.

Some documents indicate that various financial institutions were aware that they had an interest in common with others in keeping the interest rates high, but the gains to be made were still trifling.