Did Libor manipulation affect mortgage rates?

It is being reported that mortgage rates may have been detrimentally affected by the Libor manipulation, and this may have been a contributory factor leading to the repossession of some homes.

Grant Shapps the housing minister, has warned that some families may have lost their home through bank rate fixing.

He has said that research into homelessness proves there are may causes of which Libor rate manipulation may be a factor if it transpires mortgage rates were adjusted.

A Government investigation is under way. The Prime Minister is to establish a parliamentary committee involving both houses to take evidence under oath to ascertain the facts.

Barclays have been hit by a £290 million fine after admitting the manipulation of the international interest rate used to set borrowing costs. Millions of consumers, home-owners and businesses may have been negatively affected due to this manipulation.

A Barclays spokesperson has advised that the bank does not believe its action caused the loss of anyone's home.

Two further lenders Lloyds Banking Group and RBS also face being invested over their role in the Libor fixing, which has led a renewed call for banking culture and ethical standards to be overhauled.

Marcus Agius, the chairman of Barclays has now resigned saying that the buck stopped with him, Bob Diamond who is the bank’s chief executive has however chosen to ignore calls to step down. The Deputy Prime Minister Nick Clegg has already indicated that Mr Diamond should resign.

We await the outcome of the Government inquiry to see if mortgage-holders rates were detrimentally affected by the fixing of the Libor by UK banks.

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