FRANKFURT, Dec 8 (Reuters) - German banking watchdog Bafin is calling for far-reaching reforms, including a more active government role, in the setting of market benchmark values such as Libor, its head of banking supervision told a German paper.
'Reference prices that are only based on more or less random estimates are not sound,' Raimund Roeseler told Welt am Sonntag in an interview published on Sunday.
'The most relevant figures also need to be checked by a governmental body. It should not be left to the private sector alone.'
The remarks come after the EU Commission earlier this week slapped a record 1.7 billion euro ($2.3 billion) fine on six financial institutions, including Deutsche Bank, for manipulating the London Interbank Offered Rate (Libor) and its euro equivalent Euribor.
The two interest rate benchmarks are used to help price trillions of dollars of financial contracts globally.
Roeseler's statements chime with those of Bafin president Elke Koenig, who also said reform was needed in an interview with German newspaper Der Tagesspiegel.
'We have to seriously think about how we can modify the system so that it is based on real transactions and independent of individual interests,' she said, according to excerpts of the interview, to be fully published on Monday.
Koenig also said a mechanism to supervise trades could be considered to prevent manipulation.
The European Commission is also looking into possible manipulation of foreign exchange markets, although no decision has been made about whether to open a formal investigation.
'Currently, there is no indication that German institutions did participate in manipulation on the foreign exchange markets,' Roeseler said.
Over the weekend, European Central Bank board member Joerg Asmussen backed German Finance Minister Wolfgang Schaeuble's call for governments to keep scrutinising the banking sector despite complaints that they had already gone far enough.
($1 = 0.7308 euros)
(Reporting by Christoph Steitz; editing by Jane Baird and Anna Willard) Keywords: BAFIN BANKING/
(firstname.lastname@example.org)(+49 69 7565 1269)(Reuters Messaging: email@example.com)
Copyright Thomson Reuters 2013. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.