Evaluating Euribor Manipulation: Effects on Mortgage Borrowers

Araceli Rodríguez-López, Hermenegildo Fernández-Abascal, Jorge-Julio Maté-García, José-Miguel Rodríguez-Fernández, José-Luis Rojo-García and José-Antonio Sanz-Gómez

Finance Research Letters, 2021, vol. 40, issue C

Abstract: According to European Commission enquiries, several international banks (joined as interest group) manipulated, in an unethical manner, the Euribor calculation process, at least, between September 2005 and May 2008. This interest group was sanctioned for colluding practices, which are forbidden under the regulation of European Union. The paper tests for the existence of the mentioned manipulation with respect to the 12-month Euribor, and analyzes the impact on the mortgage market. Our findings suggest that a significant effect of unethical manipulative behavior on mortgage market, with mortgage borrowers overpaying on interest and potentially taking legal action.

Keywords: Euribor Manipulation; Mortgage borrowers; Collusive Bank Behavior (search for similar items in EconPapers)
JEL-codes: C51 E43 E44 G21 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:40:y:2021:i:c:s1544612320316093

DOI: 10.1016/j.frl.2020.101795

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