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Q&A: Libor rate and the regulators

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image copyrightReuters
image captionUBS is the latest bank to be hit with fines by international regulators, and others may follow

Swiss banking giant UBS has been hit hard for attempting to rig the inter-bank lending rate Libor.

It is the second major bank to fall foul of the regulators after Barclays was ordered to pay $450m to UK and US authorities in the summer, and others may well follow.

But what exactly is Libor, and why is it so important? Here we take a closer look at the issues involved: