UK, US regulators goad financial sector to speed preparations for Libor's demise

12 July 2018 10:36pm
UK, US and global authorities prodded market participants to accelerate plans to substitute nascent interest-rate benchmarks for scandal-plagued Libor in their contracts by 2021.

“The pace of that transition is not yet fast enough,” Andrew Bailey, head of the UK Financial Conduct Authority, said Thursday. “There is much further to go.” As part of this coordinated effort, the International Swaps and Derivatives Association sought industry input Thursday on ways to use the fledgling benchmarks in derivative contracts in anticipation of Libor discontinuation (see here). Bailey, the global Financial Stability Board and Christopher Giancarlo, head of the US Commodity Futures Trading Commission, agreed that Libor would disappear in many markets.

“The discontinuation of Libor is not a possibility,” Giancarlo said at a CFTC advisory panel meeting. “It is a certainty. We must anticipate it, we must accommodate it, and we must adapt to it.”