Therefore, in our eyes, and in the eyes of many other leading central banks, transaction-based interest rates appear to be the way forward to create more reliable reference rates. SWESTR – the Riksbank's response to the shortcomings in STIBOR It is in this context that the Riksbank has undertaken to calculate and publish a fully transaction-based reference rate, SWESTR (Swedish krona Short-Term Rate). The test period for SWESTR ended at the beginning of September, and SWESTR can now be used in financial contracts. The Riksbank calculates SWESTR based on transactions in Swedish kronor that are made in the money market from the current business day to the next business day (overnight, O/N). The transactions reported to the Riksbank come from nine of the Riksbank's monetary policy counterparties, all of which are banks. These are the largest and most active banks in the money market in Swedish kronor.3 The banks report money market transactions of different types and at different maturities, but only those transactions where the counterparty deposits money overnight with the bank, without obtaining collateral, form the basis for the calculation of SWESTR. The banks shall report their transactions with a wide group of counterparties. Transactions with other banks, financial companies, non-financial  4 [8]  companies and the Swedish National Debt Office are used for the calculation of SWESTR. SWESTR shall thus reflect the prevailing level of interest rates in the overnight market in Swedish kronor. There are several differences between SWESTR and STIBOR.
When the interbank rates are to be determined, the panel banks report submissions. If there are no actual transactions in the interbank market, the submissions are instead based on the banks' judgements of what the interest rate for an interbank loan would be. 2 [8]  Over time, the number of transactions on which to base the bids has declined, as interbank loans are not currently the banks’ primary source of funding. During the period January-August, there was not a single unsecured transaction at the maturity tomorrow-next in Swedish kronor between STIBOR panel banks!1 So during that period no such transactions were carried out which the daily values of STIBOR’s shortest maturity are to reflect. The submissions are therefore now based almost exclusively on the banks' judgements. And this means that the reference rate is becoming increasingly vulnerable. Interbank markets have also become less important in other countries following the global financial crisis, and therefore international interbank rates are also based to a lesser and lesser extent on actual transactions. As a result, global confidence in these interest rates has decreased rapidly. One event that further weakened confidence in interbank rates is the so-called LIBOR scandal in 2012, when it was discovered that several panel banks had manipulated submissions for their own gain, not least during the global financial crisis in 2007-2008. It was simply a question of reporting false submissions for the calculation of LIBOR with a view to benefiting their own business transactions.