The Government has launched a consultation on bringing additional financial benchmarks into the regulatory framework originally implemented for LIBOR. The consultation is based on recommendations by the Fair and Effective Markets Review, a joint review by HM Treasury, the Bank of England and the FCA.
The consultation proposes extending existing legislation to cover the following seven benchmarks:
- Sterling Overnight Index Average (SONIA) and the Repurchase Overnight Index Average (RONIA), which both serve as reference rates for overnight index swaps
- WM/Reuters 4pm London Fix, which is the dominant global foreign exchange benchmark
- ISDAFix, which is the principal global benchmark for swap rates and spreads for interest rate swap transactions
- London Gold Fixing and the LMBA Silver Price, which determine the price of gold and silver in the London market
- ICE Brent futures contract, traded on the ICE Futures Europe (IFEU) exchange, which acts as the crude oil futures market’s principal financial benchmark.
Responses are sought by 23 October 2014. The Government intends to have the new regime for the designated benchmarks in place by the end of the year.
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