Compliance & Regulation Forum

Industry standard setting bodies, regulators around the globe and the financial industry have all embarked on a journey to reform financial benchmarks widely used in the global financial system. Joint private and public sector working groups have been established in a number of jurisdictions to make recommendations on the transition to risk-free rates. In the UK, SONIA was announced in April 2017 as the preferred near risk-free interest rate benchmark (RFR) for use in sterling derivatives and relevant financial contracts, whilst in the Eurozone, the euro short-term rate (€STR) was recommended as the risk-free rate for euro products in September 2018. 

How do firms trading and clearing derivatives transition to the new rates? What will happen to legacy portfolios? What is on the agenda of the Sterling RFR WG and the Euro RFR WG now that the risk free rates have been selected? Why do we need benchmark fallbacks for derivatives contracts that reference IBORs? 

This session provides updates from regulators in the EU and the UK on the current status of the benchmarks reform and the transition away from IBORs, as well as the key steps that firms should be undertaking now to transition to new risk-free rates for new and legacy derivatives transactions. We will also hear from ISDA about the work on benchmark fallbacks for derivatives referencing key IBORs undertaken at the request of the FSB and its Official Sector Steering Group (OSSG) to support the discontinuation of widely-used interest rate benchmarks. The event will begin with a brief presentation of the global benchmarks reform by Allen & Overy and the panel discussion will be followed by Q&A. 

SPEAKERS

Tilman Lueder, Head of unit – DG FISMA, Securities Markets, European Commission
Ciarán McGonagle, Assistant General Counsel, ISDA
Heather Pilley, Technical Specialist, Benchmarks Policy, Markets Policy, Strategy and Competition Division, Financial Conduct Authority
Dr. Randy Priem, Supervision of Market Operators, Financial Services and Markets Authority (FSMA)
Vladimir Tsonchev, Money Market and Liquidity Division, DG Market Operations, European Central Bank
David Wakeling, Partner, Allen & Overy LLP
 

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