PS18/5: Powers in relation to LIBOR contributions

Open consultation: CP17/15
12/06/2017
Consultation closes
12/08/2017
Policy Statement: PS18/5
14/03/2018
14/03/2018

This Policy Statement sets the approach, criteria and methodology that we propose to apply if we needed to use powers to compel banks to contribute to LIBOR. These are based on responses to our proposals in CP17/15: Powers in relation to LIBOR contributors (PDF), and on the results of the data-gathering exercise we carried out in parallel. The Policy Statement provides feedback on the responses, and it describes the results of the data gathering.

Show PS18/5 (PDF)

LIBOR is a systemically important benchmark underpinning transactions in many different markets worldwide. Its reliability and accuracy are very important to market integrity, in the UK and globally.

Since our Consultation Paper was published, we have announced that the 20 current LIBOR panel banks have agreed to continue to submit to LIBOR until end-2021. We have also said that it is our intention that, at the end of this period, it will no longer be necessary for the FCA to compel submissions because of progress on transition to alternative benchmarks. We hope, therefore, that we no longer face a potential need to compel contributions.

Who this applies to

This Policy Statement is primarily relevant to banks that are current or potential submitters to LIBOR and the administrator of LIBOR, ICE Benchmark Administration Limited. You may have an interest if you use LIBOR, for example, in hedging products or loan agreements.

Next steps

You do not need to take action in response to this Policy Statement. As explained above, this Policy Statement explains the methodology we would expect to use if we needed to compel one or more banks to contribute to LIBOR. At this stage, we do not expect to need to use it.

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