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'Where would you like it? Libor that is': the astonishing RBS messages

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'Where would you like it? Libor that is': the astonishing RBS messages

'Where do you like it? Libor that is...same as yesterday is call.' Those words, uttered by a Royal Bank of Scotland (RBS) derivatives trader in response to a query from a manager about the rate, are characteristic of the blunt and brazen nature in which Libor rigging was discussed within the bank.

Regulators in the US and the UK have published an astonishing series of messages detailing Libor manipulation at RBS, as it announced fines totalling £390 million for the bank.

A joint investigation featuring regulators from Singapore and Japan as well as their counterparts in the US and the UK uncovered wrongdoing on the part of 21 RBS employees, predominantly in relation to the setting of the bank's Yen and Swiss Franc Libor submissions.

The conversations, a combination of exchanges by email and messaging tool Bloomberg chat are mostly between derivatives traders, who were looking to boost their trading positions, and the bank's Libor submitters.

Like similar conversations revealed when Barclays was hit with a £290 million fine for Libor fixing last year, they show a culture where Libor fixing was requested routinely, and submitters leaned on to help traders' positions, sometimes with as a little as the promise of a steak dinner as reward.

Witness this exchange between a derivatives trader and a submitter. 'Can we pls get a very very very low 3m and 6m fix today pls, we have a rather large fixings,' asks the trader, following up with 'and then from tomorrow, we need them thru the roof!!!!'

That conversation took place on 16 March 2009, but requests for Libor fixing continued well into 2010, even after RBS had been made aware of potential misconduct. Take this request from an interdealer broker who wanted Libor rates to go down to help 'a mutual friend': 'If you cud see ur way to a small drop there might be a steak in it for ya, haha.'

The reward offered by one trader in 2008 was much less extravagant, however. After their request for a low Swiss franc Libor rate was rebuffed by a submitter, one trader didn't have to push too hard to get the result they wanted:

Submitter: What's it worth

Trader: I've got some sushi rolls from yesterday

Submitter: OK, low 6m, just for you

With Barclays, UBS and now RBS having now faced the music over Libor, can we expect similarly excruciating revelations from the other banks in the frame for regulatory action?

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