U.S. interbank lending rates were mixed on Monday with the overnight Libor moving up to 0.11% and the three-month Libor retracing 3 bps to 1.47%, translating into a 4bp decline in the Libor/OIS spread to 125 bps, and the Ted spread falling 3 bps to 149 bps, the lowest since the collapse of Lehman Brothers.
Highlights from the weekend included an announcement that the Canadian and Ontario governments will provide up to C$4 billion in loans to the Canadian divisions of General Motors and Chrysler.
The financial support will be provided through Export Development Canada (EDC) and comes with the provision that the two governments will be able to oversee how the money is used.
Also over the weekend, Ireland stepped up its interventions in the banking system over the weekend, announcing an additional €5.5 billion injection of government funds into the banking system. The government now owns 75% of Anglo Irish Bank and a 25% voting right in Allied Irish Bank.
The Canadian dollar Libor is down 0.8340 bps to 1.8083%, while the three-month Libor is unchanged at 2.3000%. The Euro Libor is up 0.7500 bps to 2.1425%, while the three-month Libor is down 2.6870 to 3.0494%. The Sterling Libor is flat at 2.0000%, while the three-month Libor is down 4.3130 to 2.9350%.
By Erik Kevin Franco and edited by Nancy Girgis
©CEP News Ltd. 2008