Banks would start questioning each other and inter-bank lending would seize up.
FORBES: Fin Reg Wouldn't Have Defused Bear Stearns Time Bomb
It would unlock chains of inter-company debt, as well as weaning banks off the easy option of keeping big chunks of their balance sheet in (supposedly) risk-free government bonds and encouraging them to take more credit risk.
Market insiders at an inter-dealer broker believe that derivative revenues at the biggest European banks are at least as large.
ECONOMIST: Derivatives: Over the counter, out of sight | The
The FSA found evidence that Barclays, sometimes working with staff at other banks, had tried to manipulate Libor (the London Inter-Bank Offered Rate) and its European equivalent Euribor between 2005 and 2009.
At present, this information is in the hands of Canada's seven inter-dealer brokers, firms which handle trades for bond dealers and banks in order to keep the transactions anonymous.
Posted 6.59am: The BBC has seen documents which show that ministers in the last Labour government held discussions with banks about policies which would allow the Libor rate - the inter-bank lending rate - to fall.
There is still an inter-bank credit crunch across Europe and all three sectors - consumer, banks and governments - are still overwhelmed by bad debt.
Inter-bank lending is drying up and some investors are withdrawing funds particularly from southern European banks.
Leveraging our peer-to-peer technology we became the central hub linking the many banks and THEIR proprietary mobile wallets to the trusted payment delivery agents to solve the looming inter-wallet communication nightmare ahead of time.
He has also built up a multi-million pound business advising banks and foreign governments, which helps to fund a network of charitable foundations devoted to promoting inter-faith dialogue and other causes.
BBC: Tony Blair: I'd have done better than Brown in 2010 election
Mr Coogan warned that the bank's efforts had yet to have much effect on the London Inter-Bank Offered Rate (Libor), the main interest rate governing the cost of lending between banks.
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