Gherkin City of London

(Bloomberg) A key interest rate for more than $500 trillion of securities worldwide will be replaced by a benchmark subject to greater government control, according to a plurality of global investors.

Forty-four percent of those responding to a quarterly Bloomberg Global Poll said the London interbank offered rate, known as Libor, will be supplanted by a more regulated model within five years. Thirty-four percent predicted the rate will continue to be set by banks in the current fashion, while 22 percent said they didn’t know.

Confidence in Libor has waned as authorities investigate whether financial firms rigged the rate to profit on derivatives positions and hide how difficult it was for them to borrow money during credit-market turmoil in 2008, according to  Bloomberg.

Barclays Plc (BARC), the U.K.’s second-largest bank by assets, agreed to pay $460 million in June for its role in fixing the rate, prompting lawmakers, regulators and investors to question the veracity of a benchmark that is pegged to securities ranging from home mortgages to credit cards.

“The Libor scandal should not be something to be hidden under the carpet because it affects the correct functioning of financial markets and the economy as a whole,” said Mario Cribari, head of asset management at Veco Invest SA in Lugano, Switzerland, and a participant in the poll. Governments are trying to intervene “to calm public anger,” he said.

The quarterly poll of 847 investors, analysts and traders who are Bloomberg subscribers was conducted Sept. 4.

Libor is derived from a survey of banks conducted each day on behalf of the British Bankers’ Association in London. Lenders are asked how much it would cost them to borrow from each other for 15 different periods, from overnight to one year, in currencies including dollars, euros, yen and Swiss francs. After a set number of quotes are excluded, those remaining are averaged and published for each currency by the BBA before noon.

Investigators have focused on instances of traders coordinating submissions in order to earn profits on derivatives tied to the rates for dollars, euros and yen. The probe, which is ongoing, has ensnared banks including UBS AG (UBSN), Citigroup Inc. (C), Royal Bank of Scotland PLC, Deutsche Bank AG, and HSBC PLC (HSBA), according to company filings.

Meanwhile, regulators including the U.K.’s Financial Services Authority have started broader reviews of how the rate is determined and regulated. The European Commission said Sept. 5 it is also seeking views on possible rules, including forcing banks to provide real transaction data rather than estimates and increasing the number of lenders involved in setting the rate.

The proportion of poll respondents predicting that Libor would be replaced was consistent across the U.S., Europe and Asia.

“There will be the traditional U.K. process of an inquiry that makes few meaningful recommendations, which will then be further watered down to the point that any changes will be both minimal and satisfactory to nobody,” said Oliver Attwater, a London-based North America equity analyst for British Airways Pensions Investment Management Ltd.

The BBA, which represents more than 200 banks and lobbies policy makers and regulators on behalf of the industry, has been faulted for failing to fix Libor in 2008 when the Bank for International Settlements first raised concerns that the benchmark was being manipulated.