CONSULTATIONS RESPONSES
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European Commission consultations on CHF LIBOR and EONIA: EBF reponses
BRUSSELS, 1 September 2021 – EBF has responded to the European Commission consultations on CHF LIBOR and EONIA. Click below to read our responses.
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EONIA
The EBF has stressed in various opportunities the need to find legal solution and assess the potential terms by which a replacement benchmark would be nominated for EONIA, as well as for LIBOR (in all its currencies). The EBF, therefore, fully supports the Commission’s initiative to designate a statutory replacement rate for EONIA as part of a comprehensive solution for cash and derivative products, as this will provide legal certainty to the transition from EONIA to €STR. Full response
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LIBOR
The EBF supports the Commission’s initiative to exercise the power to designate a statutory replacement rate for LIBOR CHF. Such solution is urgently needed to safeguard counterparties from the risk of contracts discontinuity. The form of a regulation guarantees direct and uniform application in all Member States, being immediately binding. The EBF supports the choice of replacing LIBOR CHF with a Swiss Average Rate Overnight (SARON) Compound Rate plus a tenor specific spread adjustment (Spread Adjustment Value). Such replacement will maintain the characteristics of the contracts and instruments, especially in the case of loans, thus guaranteeing continuity of contracts and providing legal certainty with the highest level of consumer protection. Full response
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For more information
Francisco Saravia, Prudential Policy & Supervision, f.saravia@ebf.eu
About the EBF:
The European Banking Federation is the voice of the European banking sector, bringing together national banking associations. The EBF is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu Twitter: @EBFeu.
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