The LIBOR transition – Where are we now?

A new paradigm

The transition away from currently used interbank offered rates, particularly LIBOR, to new or reformed benchmark rates poses one of the biggest challenges for financial firms in the upcoming years. Whereas some time ago, only few subject matter experts and newly appointed transition managers at financial firms dealt with the topic, it has in the meanwhile been brought to the attention of a broad range of industry practitioners. They all, however, face the same challenge of coping with the growing complexity and faster pace of the developments around the transition.

Growing complexity

Staying ahead of the knowledge curve during the LIBOR transition increasingly resembles looking at a mosaic of information. Where LIBOR ensured a common, homogeneous approach across multiple currencies, this simplicity will be lost under the new paradigm. The complexity is the result of multiple dimensions that accompany the transition. Different currencies, markets, approaches, fallback languages, etc. show how fragmented the landscape is.

How to deal with it?

To deal with this complexity, our whitepaper provides an overview of the current status of the transition process alongside the five major currencies:

  • CHF – SARON
  • USD – SOFR
  • GBP – SONIA
  • EUR – €STR
  • EUR – EURIBOR
  • JPY – TONAR

We use a structured grid to evaluate the administrative and methodological set-up of the new benchmarks, their envisaged fallback and term approaches, the dynamics of their underlying borrowing and lending markets, and the adoption of the rates by cash and derivatives markets.

Download our whitepaper

 

Contact us

Christian Schmitt

Christian Schmitt

Partner, FS Advisory, PwC Switzerland

Tel: +41 79 833 5140

Patrick Akiki

Patrick Akiki

Partner, Financial Services Advisory (Finance Risk and Regulatory Transformation), PwC Switzerland

Tel: +41 58 792 25 19

Dr. Manuel  Plattner

Dr. Manuel Plattner

Advisory Director, PwC Switzerland

Tel: +41 58 792 14 82

Matthieu Patrice

Matthieu Patrice

Senior Manager, FS Advisory Liquidity & Funding Lead, PwC Switzerland

Tel: +41 58 792 44 33