IBA has published a roadmap for the evolution of LIBOR. The roadmap, to be implemented this year, outlines a set of measures to anchor LIBOR in transactions from a broader set of market participants, reflecting changes in banks’ funding models. It seeks to increase banks’ participation by:
- incorporating transaction data into the LIBOR methodology to the greatest extent possible;
- clarifying the definition of LIBOR;
- ensuring the rate can adapt to changing market conditions with appropriate consideration for stakeholder interests; and
- conducting a feasibility study on transitioning the calculation of LIBOR to IBA, using transaction data to deliver an even more robust and sustainable rate for the long term.
(Source: IBA publishes roadmap for ICE LIBOR)