FSA to revamp Libor panels

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The City watchdog has unveiled plans to include more banks on the panels that set benchmark interest rates, and said firms that do not volunteer to join could be compelled to participate.

The Libor process is being reformed in the wake of the rate-fixing scandal that saw Barclays fined a record £290 million by UK and US regulators, and the 
Financial Services Authority (FSA) wants at least 20 banks to take part in each currency panel.

Currently, 11 to 18 banks contribute to setting Libor in five main currencies, but FSA managing director Martin Wheatley said having more firms on the panels would discourage attempts to manipulate rates.