N.Y. MTA Studies Possible Libor Hit

New York’s Metropolitan Transportation Authority is studying whether the agency sustained losses in connection to the alleged manipulation of the London interbank offered rate.

“It’s an ongoing situation with Libor. We believe it does have an effect on the MTA, and we’re following what the regulators in Great Britain and the United States are doing,” finance manager Patrick McCoy said about the mushrooming scandal Monday at the authority’s monthly finance committee meeting.

Britain’s Financial Services Authority last month fined Barclays Plc, Britain’s second-largest bank by assets, £290 million ($450 million) fine for submitting false rates for Libor, a benchmark interest rate for financial products valued at $360 trillion. The U.S. Department of Justice is also considering whether to charge Barclays traders.

Several other investment banks are under investigation.

Board member Allen Cappelli asked whether New York State Attorney General Eric Schneiderman would represent the MTA in any action his office takes.

“Our counsel is examining all our options. It’s critical that we protect our assets,” board Chairman Joseph Lhota said.

The MTA on Wednesday will introduce its annual budget and four-year financial plan. Next week it will price a $1.1 billion sale of general revenue bonds for its Triborough Bridge and Tunnel Authority subsidiary. According to McCoy, proceeds will primarily fund Series 2002B bonds.

For reprint and licensing requests for this article, click here.
Transportation industry New York
MORE FROM BOND BUYER