CP21/19: Proposed decision under Article 23D BMR for 6 sterling and yen LIBOR settings

Open consultation: CP21/19
24/06/2021
Consultation closes
27/08/2021
27/08/2021

We consulted on our proposal to use our Article 23D(2) powers introduced through amendments to the Benchmarks Regulation (BMR) under the Financial Services Act 2021 (FS Act). We proposed to require the administrator of LIBOR, ICE Benchmark Administration (IBA), to change the way 1-month, 3-month and 6-month sterling and Japanese yen LIBOR settings are determined after 2021 (ie ‘the 6 LIBOR settings’) to secure an orderly wind-down. Our requirement would be conditional on any designation of the 6 LIBOR settings as Article 23A benchmarks taking effect immediately after end-2021. 

Read CP21/19 (PDF)

Why we are consulting 

We were seeking views on our proposed decision to use our Article 23D(2) BMR powers to secure an orderly wind-down of the 6 LIBOR settings and advance our objectives of consumer protection and the integrity of the financial system. 

In March 2021, we announced the future cessation or loss of representativeness of the 35 LIBOR benchmark settings. This includes the cessation of all sterling and Japanese yen LIBOR panels immediately after end-2021. We said we would consult on using our Article 23D(2) powers to require the 6 sterling and Japanese yen LIBOR settings to be determined under a changed methodology (ie on a ‘synthetic’ basis) after end-2021, and are now doing so. 

Who this applies to 

We expect that this consultation will be of interest to: 

  • regulated and unregulated users of LIBOR 
  • the administrator of LIBOR, IBA 
  • providers of component inputs for a potential ‘synthetic’ LIBOR 

Next steps 

This consultation has now closed. We will publish a feedback statement once we have reviewed your comments.