“Two European regulators said the continent’s most prominent benchmark interest rate has “significant weaknesses,” and urged the banking group that oversees the rate to quickly revamp it.

The regulators’ conclusion represents the latest blow to the euro interbank offered rate, or Euribor, and the European Banking Federation that oversees it. The rate, which serves as the basis for trillions of euros worth of loans and other financial contracts, has been tarnished by banks’ attempts to manipulate it and by the recent decisions of a handful of banks to stop being involved in setting the rate.

The European Banking Authority and the European Securities and Markets Authority, both of which are pan-European Union agencies, have been conducting a review of Euribor and its governance since last fall. On Friday, they recommended a number of changes to improve Euribor’s credibility and called on the Brussels-based banking federation to implement them within six months.”

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