British Bankers Association (BBA) Definition

What Was the British Bankers Association (BBA)?

The British Bankers Association (BBA) was a trade organization for the banking sector in the United Kingdom. Headquartered in London, the BBA represented the interests of a range of financial services companies, including banks, and was owned and overseen by its members. As such, it was considered to be the voice of British banking. Originally intended only for British banks, the organization opened membership up to other banks operating within the U.K., including foreign institutions. The BBA officially dissolved after it merged with other organizations to form UK Finance in 2017.

Key Takeaways

  • The British Bankers' Association was a trade organization that represented the interests of banks and other financial institutions.
  • The BBA was owned and overseen by its members.
  • Originally intended solely for British banks, the BBA opened up its membership to foreign banks operating on British soil.
  • Among some of its responsibilities, the BBA lobbied for the industry and set the LIBOR rate before it was taken over by ICE Benchmark Association.
  • The BBA officially dissolved after it merged with four other organizations to form UK Finance in 2017.

Understanding the British Bankers Association (BBA)

The British banking industry is robust and resilient, according to the Bank of England (BoE). The country's central bank is responsible to ensure that domestic banks run safely and smoothly—the same way the Federal Reserve System does for banks in the United States. But the interests of British banks and financial institutions were represented by the London-based British Bankers Association.

The BBA was created in 1919 after the Central Association of Bankers and the Association of English Country Bankers merged into a single unit. At the time, it made more sense to have a single association that would advance the interests of the country's banking industry. Membership was restricted solely to British banks until 1972 but the organization opened up to foreign institutions operating in the country.

More than 230 members, based in over 50 countries, were part of the BBA. The agency lobbied on behalf of its members, providing its view on the legislative and regulatory system for banking in the U.K. It was also responsible for improving the country's Banking Code, Small Business Code, accounting principles, and European regulations regarding banking practices.

In July 2017, the BBA merged with Payments UK, the Council of Mortgage Lenders, the UK Cards Association, and the Asset Based Finance Association to form UK Finance. The merger aimed to "promote a safe, transparent and innovative banking and finance industry." UK Finance works with more than 300 different member organizations in an effort to boost competition, provide support to customers, and promote innovation.

The American Bankers Association (ABA) is the American equivalent of the BBA. The ABA represents the interests of various banks, including small, large, and regional institutions.

Special Considerations

The BBA was also responsible for setting benchmark rates, such as the London Interbank Offered Rate (LIBOR). This is the rate that some global banks charge each other for short-term loans.

In 2012, it became clear that banks were manipulating the LIBOR. Investigations over the alleged rate rigging were initiated in more than a dozen banks. Barclays Bank was fined £59.5 million for failings related to the LIBOR and EURIBOR in accordance with the Financial Services and Markets Act 2000.

The UK’s Chancellor of the Exchequer commissioned Martin Wheatley to conduct an independent review of the various aspects of LIBOR in June 2012. The most important recommendation made by the Wheatley Review of LIBOR was to hand over the LIBOR to a new administrator. On Feb. 1, 2014, Intercontinental Exchange (ICE) Benchmark Association became the official administrator of the LIBOR, bringing more transparency as well as a robust oversight and governance framework.

ICE stopped publishing one-week and two-month USD LIBOR after Dec. 31, 2021. All other LIBOR will be discontinued after June 30, 2023. The LIBOR rate will be replaced by benchmark rates based on the Secured Overnight Financing Rate (SOFR) after this date, according to the Federal Reserve.

What Happened to the British Bankers' Association?

The British Bankers' Association merged with four other organizations to form UK Finance. The merger, which took place with Payments UK, the Council of Mortgage Lenders, the UK Cards Association, and the Asset Based Finance Association, was completed in 2017. Prior to this, the BBA represented the interests of financial institutions that operated in the United Kingdom—both foreign and domestic.

What Does UK Finance Do?

UK Finance is an organization that represents the interests of more than 300 companies in the banking and finance industry. It is tasked with promoting competition, providing support to customers, and boosting innovation. UK Finance was established in 2017 following the merger of five different financial organizations, including the British Bankers' Association.

What Is LIBOR?

LIBOR stands for London Interbank Offered Rate. It is a benchmark interest rate used by global banks when they provide short-term loans to one another in the international interbank market. The LIBOR rate was set by the British Bankers' Association until 2014 when it was taken over by the Intercontinental Exchange Benchmark Association. The switch came after an investigation in 2012 into alleged rate rigging by several banks. Several key LIBOR rates are no longer published and others will be completely phased out by the end of June 2023.

The Bottom Line

The British Bankers' Association was a key part of the banking industry in the United Kingdom. It lobbied for and represented the interests of many institutions in the country—first, for British banks and then for foreign banks operating in the U.K. The BBA was an important part of the banking system as it lobbied on behalf of its members. The organization no longer exists, as it was merged with four other key financial groups to form UK Finance in 2017.

Article Sources
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  1. London Metropolitan Archives. "BRITISH BANKERS' ASSOCIATION."

  2. Bank of England. "Financial Stability Report - December 2022."

  3. Crunchbase. "British Bankers Association."

  4. UK Finance. "ABOUT US."

  5. Council on Foreign Relations. "Understanding the Libor Scandal."

  6. Financial Conduct Authority. "Barclays fined £59.5 million for significant failings in relation to LIBOR and EURIBOR."

  7. Intercontinental Exchange. "LIBOR."

  8. Bank of England. "Transition from LIBOR to risk-free rates."

  9. Board of Governors of the Federal Reserve System. "Federal Reserve Board adopts final rule that implements Adjustable Interest Rate (LIBOR) Act by identifying benchmark rates based on SOFR (Secured Overnight Financing Rate) that will replace LIBOR in certain financial contracts after June 30, 2023."