On 12 June 2013, the British Bankers’ Association (BBA) announced changes to the London Interbank Offered Rate (LIBOR) in an attempt to restore confidence in Libor as a reliable benchmark in the wake of last year’s rate-fixing scandal. Following recommendations of the Wheatley Review published last September, the BBA press release and announcement state that:
- With effect from 1 July 2013, the publication of BBA LIBOR individual panel banks’ daily submissions for USD, EUR, GBP, CHF and JPY, across all tenors, will be embargoed for three months, although the daily calculation and publication of BBA LIBOR fixing rates will continue. Subsequently, rates will be released with a three-month delay.
- The publication of “same day” EURO LIBOR rates for one week and one month will cease from 31 July 2013. These two rates were supplemental to the “spot” EUR LIBOR rates for all seven LIBOR tenors, which will continue as usual.
These changes come amidst reports last week that the European Commission is considering stripping London of its control over the Libor lending rate and handing over supervision to the European Securities and Markets Authority (ESMA). The proposal is due to be published this summer but progress may be delayed by European Parliamentary elections next year.Contact Us