Fall-back Benchmark Consultation

The New Zealand Financial Markets Association are consulting on a fall-back benchmark interest rate for BKBM. A fall-back benchmark interest rate is required to comply with the IOSCO Principles for Financial Benchmarks and ensure that BKBM will meet European Union Benchmark Regulation (EU BMR) equivalence from January 2020. This will ensure that the current benchmark, BKBM, remains fit for purpose, can be used by European supervised entities post 2020, and the necessary structures are in place should BKBM cease to exist at some point in the future.

The NZFMA welcomes submissions from any entity that either uses or is affected by New Zealand's interest rate benchmark. Submissions close at 5pm on Friday 1 March 2019 and should be sent to submissions@nzfma.org .

Link to consultation document here.-

NZFMA will be holding two seminars in late January to provide more background and to answer any questions from interested parties.

Fall-back Benchmark Consultation Seminars
Wellington Auckland
Tuesday 29 January @ 1.30pm Thursday 31 January @ 1.30pm
ANZ Buddle Findlay
Level 18, ANZ Centre, 171 Featherston Street, Wellington Level 18, PWC Tower, 188 Quay Street, Auckland

The NZFMA encourages your attendance at these seminars. If you wish to attend please register via email to maria.chandler@nzfma.org by close of business Thursday 24 January.

If you have any questions or comments on the consultation or the seminars please do not hesitate to contact John Groom, Director Operations and Compliance at the NZFMA - john.groom@nzfma.org.

Useful Links:

IOSCO Principles for Financial Benchmarks

Financial Stability Board - Reforming major interest rate benchmarks 2014

Financial Stability Board - Reforming major interest rate benchmarks progress report 2018

Financial Stability Board Interest rate benchmark reform - overnight risk-free rates and term rates 2018

ISDA consultation on term and credit rates 2018

Preliminary results of ISDA consultation on term and credit rates 2018

European Union Benchmarks Regulation 2016

Bank of England - Sonia Key features and policies 2018

Federal Reserve Bank of New York - Introducing the Secured Overnight Funding Rate (SOFR) 2017

Federal Reserve Bank of New York - Transition to a Robust Reference Rate Regime 2018




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