A Toronto branch of Royal Bank of CanadaMARK BLINCH/Reuters
The deepening scandal around Libor rigging has investors trying to puzzle through which banks could be next to face regulators' wrath.
Barclays Bank PLC has paid a huge price, settling for hundreds of millions, losing its senior management and watching its shares fall. So it's key for investors to try to guess if any other Libor-setting banks are in line for similar treatment.
An analysis by investor and economist David Merkel at his Aleph blog finds that there were two groups that showed statistical signs of working together to influence Libor. One, which included Barclays, appeared to be trying to push Libor higher. The other appeared to want to pull Libor lower.
As for the one Canadian bank on the U.S. Dollar Libor panel – Royal Bank of Canada – investors can breathe a little easier. It doesn't fall clearly into either group, Mr. Merkel finds.