Get ready for the IBOR transition
With the December 2021 deadline approaching, financial institutions face enormous challenges in the LIBOR transition and the transition from other benchmarks to RFRs. The reform is significant.
This transition is not a one-off switch — it is a long and complicated journey, with participation from regulators. Market participants need to take immediate action to ensure a smooth transition.
MX.3 for IBOR Reform can help you navigate the LIBOR transition and IBOR replacement, delivering new functionalities for all asset classes, including cash and derivatives, to ensure a smooth transition.
IBOR replacement challenges
A developing regulatory environment
Emerging market standards and conventions
Global impact and time-constrained transition
Complex modeling requirements for emerging RFR products
Multiple phases and challenges loom post-IBOR cessation
Countdown to LIBOR transition
- JULY FCA Andrew Bailey speech
- JANUARY SARON replaces TOIS
- APRIL SOFR publications begins
- MAY CME starts SOFR futures
- OCTOBER Eurex starts SARON futures, ICE starts SOFR futures
- JUNE First GBP FRN transitions from LIBOR to SONIA
- OCTOBER €STR publication begins
- JULY €STR discounting switch at CCPS
- AUGUSTDiscounting switchAcceleration of CSA re-papering of bilateral trades – driven by change in Collateral Interest calculation (PAI)
- OCTOBER SOFR discounting switch at CCPS
- Term SONIA rates tradable by end of 2020
- JANUARY ISDA fallback protocol
- Transition EventsEarly transition:
- • Bilateral derivates
- • Loans & Bonds
- Terms rates for SOFR/others
- DECEMBER Cessation of non-USD LIBOR publications
- Cessation of USD LIBOR 1W and 2M publications
- Options on RFR
- Term rates for €STR
- BBSW/EURIBOR termination?
- Cessation of the remaining USD LIBOR publications and LIBOR-dependent benchmarks (e.g., SOR) by mid-2023
- And more...
MX.3 for IBOR Reform
Seamless, flexible, intuitive
- Multifaceted solution
- Covers all business processes across FO, Operations, Risk, Finance
- Quick evolution as market transformations unfold (e.g. new instruments, new models, fallback protocols, etc.)
- Easy solution deployment
Accelerate, automate and simplify the LIBOR transition with MX.3
“The central assumption that firms cannot rely on LIBOR being published after the end of 2021 has not changed, and this should remain the target date for all firms to meet.” BoE, FCA and GBP WG joint statement
“At the time that Libor ceases, there is a good chance the fallback spread will be relatively close to the historic median. However, there is also a possibility that the spread will be significantly above, or even below, the historic median.”Christopher Willis and Edmund Allen, Coremont LLP
“We know that Libor will continue until end 2021, but announcements about the discontinuation from the end of 2021 of Libor settings could come as early as November or December this year”Edwin Schooling Latter, FCA
“We’re pleased to be continuing our work toward a smooth transition to alternative reference rates. Our work with Murex will enable us to continue along this path and allow us to adapt to the changes in a timely manner.”Philip Whitehurst, LCH
Stella Clarke, Murex CMO, sat down with Finextra to discuss the challenges that come with the move away from LIBOR, the steps that capital markets institutions need to take to be ready for the change and how the right technology can help smooth the transition path.Watch video
The challenge that the capital markets industry is facing as short-term SOFR and LIBOR remain decorrelated until the Libor Transition is outlined in this Risk.net feature.Read more >
Technology is key to financial institutions’ ability in overcoming alternative reference rate transition hurdles. Market actors need to be able to trade, process and risk manage new benchmarks.Read more >
As the capital markets continue to evolve, opportunities and challenges appear in equal measure. In this time of fundamental change, banks must offer rich services and creative solutions to their clients, while balancing cost pressures and regulatory constraints.Read more >
In the evolving ISDA context, this blog seeks to explore what IBOR solution technology is necessary to address the two major dynamics of the transition.Read more >
Get in touch with Murex’s IBOR team
Murex’s dedicated team is here to help you with the upcoming IBOR transition and support you in meeting the regulatory deadline. Please call your regional office or, if you prefer to be contacted, complete the form and one of the team will get in touch.
For more than 30 years, Murex has been providing cross-asset financial technology solutions to capital markets players. Its platform, MX.3, supports trading, treasury, risk and post-trade operations, enabling clients to better meet regulatory requirements, manage risk, and control IT costs. With more than 55,000 daily users in 60 countries, Murex has clients in many sectors, from banking and asset management to energy and commodities. The MX.3 Risk and Regulatory Suite is a comprehensive framework that enables financial institutions to build a strategy for regulatory compliance and internal risk management. Find out more at www.murex.com.