Central banks role major concern

Europe's biggest insurer, Allianz, is worried about the role central banks may have played in an interest rate rigging scandal that has enveloped some leading international lenders, the insurer's chief financial officer said. "We do not find it funny, what has happened, in particular the arising implication that it is not just the banks but central banks being involved in this," Oliver Baete told a conference call with analysts. "That really gives us cause for concern," Baete added, according to Reuters. An Allianz spokeswoman said Baete was speaking generally and declined to specify which central banks Baete had in mind. More than a dozen global lenders, including Citigroup, JPMorgan and Deutsche Bank, are under investigation over whether they manipulated a benchmark interest rate called Libor in an attempt to make profits or hide weaknesses. The Libor rate is used for $ 550 trillion of interest rate derivatives contracts and influences rates on a wide array of consumer products such as mortgages and credit cards. Royal Bank of Scotland earlier said it had dismissed staff in the scandal, while rival Barclays was fined $ 453 million by US and UK regulators last month. But banking regulators, too, have come under scrutiny. Allianz's Baete said Germany's insurers were making checks on an industry level to see if any losses had been sustained but added that his own company had no third-party assets directly tied to Libor and did not expect major losses on money it manages for its internal insurance clients. From arabnews