It is important for those of you that have exposures to Libor to not leave it too late in making appropriate arrangements. For South Africa, the SARB’s publication of a consultation paper3 on selected interest rate benchmarks last August marked a key step towards the reform of existing interest rate benchmarks.
The consultation paper proposes the adoption of new benchmarks with the aim of enhancing transparency in the domestic money market while also enriching the framework for the monitoring and identification of systemic risk. Extensive research into the robustness and sustainability of the Johannesburg Interbank Average Rate (Jibar) and the South African Benchmark Overnight Rate (Sabor) had revealed shortcomings.