Citigroup, Deutsche, HSBC Agree to $132 Million Settlement in Libor Scandal

By Maria Armental Features Dow Jones Newswires

Citigroup Inc., Deutsche Bank AG, and HSBC Holdings PLC have agreed to pay about $132 million in total to resolve accusations they rigged a lending benchmark, according to court documents.

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The proposed settlements, pending court approval, include no admission of wrongdoing.

In turn, the three banks agreed to cooperate with the plaintiffs--futures traders and others that lost money because of the alleged manipulation--in a 2011 class-action complaint filed against leading financial institutions. The three banks are among those the complaint was filed against.

Banks have paid billions of dollars in penalties to resolve similar criminal and civil cases accusing them of manipulating the London interbank offered rate, or Libor, which is calculated based on submissions from a panel of banks.

Libor, which is being phased out, is used to set interest rates in trillions of dollars of financial contracts, including corporate debt and home mortgages.

According to documents filed Wednesday in Manhattan federal court, the three banks reached the tentative agreements in July, with Deutsche Bank agreeing to pay $80 million, Citi $33.4 million and HSBC $18.5 million.

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The money would go into a settlement fund to compensate those who lost money because of the alleged manipulation.

A representative for HSBC released a statement saying, "We are pleased the matter is resolved." Citi declined to comment. Deutsche Bank couldn't be reached for comment on Thursday evening.

Barclays PLC, which reached a similar settlement agreement in 2014, has agreed to turn over lists of clients who traded eurodollar futures during the class period, which would be expanded to Jan. 1, 2003, through May 31, 2011.

If approved, the settlements would cover anyone who transacted in eurodollar futures or options on eurodollar futures on exchanges, including the Chicago Mercantile Exchange, during that period.

Write to Maria Armental at maria.armental@wsj.com

(END) Dow Jones Newswires

October 13, 2017 02:16 ET (06:16 GMT)