Sky's City editor says: “The council of the British Bankers’ Association has formally voted to give up its responsibility for setting the interbank borrowing rate Libor following the fixing scandal that engulfed the industry three months ago.
“I have learned that at a BBA council meeting on September 13, a motion was passed for the organisation to relinquish its role in the Libor administration process.
“The development, while not wholly unexpected, will effectively force regulators to devise a new structure for overseeing the benchmark rate, which has been sponsored by the BBA since the 1980s.”
Details of the BBA council vote have emerged just days before Martin Wheatley, managing director of the Financial Services Authority (FSA) and chief executive-designate of the Financial Conduct Authority, recommends reforms aimed at restoring the credibility of Libor.
Mr Wheatley is expected to say in a speech to City financiers on Friday that the rate-setting process should have formal regulatory oversight, potentially by a body such as the Financial Stability Board.