An alternative to Euribor, should a revamp of the benchmark to make it compliant with European regulation not be successful, can’t be done on time, according to recently published minutes from a working group formed by the European Central Bank.
Europe’s endorsed alternative reference rate, Ester (the euro short-term rate), doesn’t exist yet. But it will need to, and be fully functional, by January 2020. This is when the EU Benchmarks Regulation (BMR) stipulates that critical benchmarks like Eonia and Euribor must comply or be replaced in financial instruments.
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