FSB report: risks to financial stability from LIBOR transition must reduce
The Financial Stability Board (FSB) has published its annual progress report on the implementation of recommendations to reform major interest rate benchmarks.
The report outlines the risks to financial stability from continued reliance on London Interbank Offered Rate (LIBOR) beyond 2021. It sets out progress on implementing related FSB recommendations.
The report calls for significant and sustained efforts by the official sector and by financial and non-financial firms across many jurisdictions to transition away from LIBOR by end-2021.
Given the degree of risk arising from the continued reliance on LIBOR, the FSB notes that regulated firms should expect increased scrutiny of their transition efforts as the end of 2021 approaches.
The FSB will deliver to G20 Finance Ministers and Central Bank Governors in July 2020, and publish a report on remaining challenges to benchmark transition.
Further details are available here.