Image copyright Reuters Image caption Financial institutions in London and New York have settled regulatory allegations of rigging Libor

A senior banker from a UK bank has admitted conspiring to defraud over manipulating the Libor lending rate.

The banker, who can not be named for legal reasons, is the first person in the UK to plead guilty to the offence.

Two men have already pleaded guilty in the US to fraud offences linked to the rigging of Libor, for years the benchmark by which trillions of pounds of financial contracts are based.

The case arose from the Serious Fraud Office's (SFO) investigations.

Libor - what is it and why do we care? Explaining the Libor scandal

It began looking into Libor manipulation in 2012 after it emerged that it was being widely abused by leading banks to manipulate rates in their favour.

New laws

The economic secretary to the Treasury, Andrea Leadsom, said: "The integrity of the City matters to the economy of Britain. Ensuring that the key rates that underpin financial markets are robust, and that anyone who seeks to manipulate them is subject to the full force of the law is vital."

The government started consulting on new laws to ensure that markets are fair two weeks ago.

It would like to create a new criminal offence for the attempted manipulation of Libor, and extend any new legislation to cover seven other major financial benchmarks.

The SFO's investigation continues and 11 other individuals stand charged and await trial.

Seven banks and brokerages have settled regulatory allegations of interest rate rigging in the UK and the US after global investigations.

So far, 17 men have been charged with fraud-related offences.

Last month, Lloyds Banking Group dismissed eight staff members following an investigation into the behaviour of its rate setters.

The move follows the bank's £218m fine in July for "serious misconduct" over the setting of Libor.