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Libor

• Denotes London Inter Bank Offered Rate which is the rate on Eurodollar deposits traded between banks. There is a different LIBOR rate for each deposit maturity. Different banks may quote slightly different LIBOR rates because they use different reference banks.

• The London Interbank Offered Rate; the rate of interest that major international banks in London charge each other for borrowings. Many variable interest rates in the U.S. are based on spreads off of LIBOR. There are many different LIBOR tenors.

• Is the London Interbank Offered Rate.

 
 Embedded terms in definition
 Eurodollar deposits
Eurodollar
Interbank
Interest rate
Interest
Maturity
Quote
Rate of interest
U
Variable
 
 Referenced Terms
 Base rate: Base Rate is quoted off a short term fluctuating rate such as Libor or Prime Rate. LIBOR denotes London InterBank Offered Rate. Prime is an administered rate announced by large banks. Hence a base rate may be quoted as LIBOR plus say 1%.

 Circus swap: A fixed rate currency swap against floating U.S. dollar Libor payments.

 Differential swap: Swap between two LIBO rates of interest, e.g. yen Libor for dollar LIBOR. Payments are in one currency.

 Eurodollars: U.S. dollars deposited in a foreign bank or foreign branch of a U.S. bank. Maturities usually less than 6 months and interest rates are always fixed (expressed as Libor rates).

 Limean: The average of Libor and LIBID for Eurodollar deposits of a given tenor.

 
 Related Terms
 London interbank offered rate libor

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