07.20.2018

BoE Consults On Term SONIA Reference Rates

The Working Group on Sterling Risk-Free Reference Rates has launched a consultation on term SONIA reference rates (TSRRs).

It seeks feedback on specific recommendations and encourages market participants to take forward work on the development of robust TSRRs, which members anticipate could be available in the second half of 2019. Feedback should be provided by 30 September 2018.

Source: Bank of England

Law firm Norton Rose Fulbright said on its blog:

“The consultation seeks feedback on practical recommendations aimed at catalysing the development of term SONIA reference rates. Market participants – including venue operators, market makers and potential administrators – are encouraged to work towards this objective.

The consultation has been launched simultaneously with ISDA’s consultation on new IBOR fallbacks for over-the-counter derivatives contracts. The consultations address different aspects of benchmark reform: the ISDA consultation is focused on preventing derivatives market disruption in the event a key IBOR is discontinued; the Working Group’s consultation focuses on how a TSRR can be constructed in order to facilitate sterling Libor transition in markets where term rates better suit users’ needs. ISDA’s consultation contemplates that the primary fallbacks for key IBORs will directly reference overnight risk-free rates.”

 

 

Related articles

  1. Hermes Warns of Brexit Risk to Asset Managers
    Daily Email Feature

    Equivalence a Theme at FIA IDX

    Trade associations have asked for an extension of the temporary equivalence decision for UK CCPs. 

  2. Contracts will be based on Bloomberg Barclays MSCI Global Green Bond and Euro Corporate SRI indexes.

  3. Aberdeen AM Looks to Grow In China

    Trading Technologies has partnered with Chinese clearing broker COFCO Futures.

  4. The exchange's derivatives segment will close for trading on Friday 28 January 2022.

  5. The offering makes it simple for firms to track their sustainable derivatives positions.