Libor review: Wheatley says system must change

The current Libor rate-setting system is no longer a "viable option", according to the government-commissioned Wheatley Review.

It proposes pegging the rate to actual market data, rather than subjective submissions from banks, and introducing formal regulation.

Stronger sanctions to tackle abuse of the system are also included in the initial discussion paper, external, which aims to restore credibility.

The review was established after the UK bank, Barclays, was found to have tried to manipulate Libor rates by putting in inaccurate submissions, resulting in a record £290m fine in June from both US and UK regulators.

Emma Simpson reports.