BoE To Modify Clearing Rules Ahead Of Libor Transition
By Najiyya Budaly (September 30, 2021, 12:02 PM BST) -- The Bank of England plans to update European Union rules that define which derivatives must be cleared as it seeks to provide certainty for counterparties when the tarnished Libor interest-rate benchmark is discontinued at the end this year.
The central bank said on Wednesday that it will modify the scope of contracts subject to the derivatives clearing obligation. The rule, which was written into domestic law from the European Market Infrastructure Regime, forces counterparties to an over-the-counter derivatives contract to centrally clear their trades to help prevent market abuse in unlisted securities.
Contracts that refer to the London Interbank Offered Rate...
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