ABU DHABI – British bank, Barclays, plans to abandon an interchange fee rate setting in United Arab Emirates (UAE) because of their involvement in the scandal of the Libor rate in Britain.
The bank belongs to a panel of 12 banks set interest rates on interbank Arab Emirates dirham. Contributions are calculated according to the daily reach of interbank interest rates, used for trading financial instruments in the financial center of the Persian Gulf.
“Barclays said the UAE central bank that wants to leave the commission and the central bank called a meeting for Tuesday to discuss who will replace Barclays,” said a source familiar with the matter as anonymity because he did not yet an ad public.
A Barclays spokesman was not immediately available for comment. Treasury officials UAE central bank declined to comment.
Late last month, Barclays agreed with regulators in the U.S. and Britain to pay $453 million fine for trying to manipulate the London interbank offered rate (or Libor) through presentations to the panel itself.
There were suggestions that the bank tried to manipulate the Libor.
Balance
Barclays has a wide range of operations in the UAE, including corporate and personal banking. Thanks to oil, the federation is the second largest Arab economy in the world. Dubai, one of the seven emirates of UAE, provides financial services to much of the Gulf by opening their markets and their international links.
It is unclear what would replace Barclays bank in the UAE committee, said a second source.
The UAE central bank would like to retain the current balance of the commission between local and foreign banks, but there are few obvious candidates, the source added.
“In addition to those already on the commission, most foreign banks have only general operations or just a small presence here in the UAE,” said the source.
In addition, Barclays, Citigroup , HSBC and Standard Chartered are on the commission along with eight local banks.
