Libor falls most in four months amid signs of banking recovery
Bloomberg / May 20, 2009, 00:03 IST
The cost of borrowing in dollars between banks had its biggest two-day drop in more than four months amid confidence record low interest rates and a recovery among financial institutions is boosting lending.
The London interbank offered rate, or Libor, for three- month dollar loans declined three basis points on Tuesday to 0.75 per cent, the British Bankers’ Association said, bringing its drop in the past two days to seven basis points, the most since January 13.
The rate has decreased in each of the past 35 days. Goldman Sachs Group, JPMorgan Chase and Morgan Stanley applied to refund a combined $45 billion of US government money, sources said. That would mark the biggest reimbursement to taxpayers since the $700 billion Troubled Asset Relief Program, or TARP, began. Mitsubishi UFJ Financial Group, Japan’s biggest bank, forecast a return to profit, adding to evidence the worst of the financial crisis may have passed.
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