Libor-fixing scandal 'not a major concern' says Icap boss Spencer
Icap's chief executive, Michael Spencer, yesterday sought to torpedo fears of the company being drawn more deeply into the Libor-fixing scandal, dismissing it as "not a major concern for the group".
Mr Spencer, who founded the company which allows banks to trade a huge range of financial instruments anonymously, said: "We do not collate, collect, contribute to or calculate Libor and have never done so. We are not directly involved in the Libor process."
Icap has placed two traders on "administrative leave" while the Financial Services Authority continues its investigations into Libor fixing. However, they are understood to be on full pay.
The investigation into the Libor affair – that has seen Barclays fined £290m and forced the departure of its chief executive Bob Diamond – has been widened to cover inter-broker dealers like Icap.
However, Mr Spencer added: "All I can say is that we do not have regulators beating our front door day-to-day nor minute-to-minute. It is not a high priority at this moment nor a high concern to us. We do not consider ourselves in any way front or forward in this particular debate. But we are a big organisation, a professional organisation. And of course, where we can, we do what we can appropriately to assist the regulatory authorities to establish what may or may not have been going on."
Mr Spencer further pointed out that the level of Libor, whether rigged or not, had no commercial effect on the broking firm. At yesterday's shareholder meeting he said revenues in the first quarter were down nine per cent, thanks in part to the ongoing effect of the eurozone crisis and the loss of trading days during the Jubilee weekend.
Mr Spencer said he expects trading to remain subdued, particularly through the Olympics and US Presidential election.
Cost cutting should produce annualised savings of at least £50m by the end of the current financial year with more pencilled in for next year.
For the full year, Icap forecasts pre-tax profits of between £335m and £365m, which compares with the £354m it made last year.
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