31 May 2013

EBF: Euribor and Eonia panels to be differentiated

As of 1 June 2013, the Eonia and Euribor respective panels of contributing banks will be differentiated. Concretely, this means that the panel banks reporting to Eonia will not necessarily be the same panel banks as those contributing to Euribor any more. (Includes ECB response.)

This decision was taken in the context of the reform of the benchmark’s governance and rate-setting process. It aims to encouraging banks to re-join or join the respective reference rate panels according to their level of activity and knowledge in the respective market segments.

To this end, Euribor-EBF takes this opportunity to invite former panel banks to re-join either the Eonia or the Euribor panel of contributing banks. As publicly stated by Commissioner Barmier, the forthcoming European Commission’s proposal on benchmarks will indeed include the power to impose mandatory submissions on banks.

The relevant documentation (e.g. Eonia and Euribor respective Codes of Conduct) will be adapted early July 2013.

Eonia® is computed as a weighted average of all overnight unsecured lending transactions in the interbank market, undertaken in the European Union and European Free Trade Association (EFTA) countries by the Panel Banks. It is based on real-transactions.

Euribor® is the rate at which euro interbank term deposits are offered by one prime bank to another prime bank within the EMU zone.

Press release

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ECB welcomes the introduction of separate Eonia and Euribor panels and encourages banks’ participation

The Governing Council of the European Central Bank (ECB) welcomes Euribor-EBF’s decision to introduce separate Eonia and Euribor panels with a view to encouraging banks to join or re-join the reference rate panels according to their level of activity and knowledge of market segments. In the light of this decision, the ECB strongly encourages banks to remain in, join or re-join the reference rate panels in order to ensure an appropriate level of participation, so that the reference rates serve their purpose of adequately reflecting market developments.

Reference rates such as Eonia and Euribor are important for the functioning of the euro area economy, including the implementation of monetary policy. The availability of reliable reference rates enhances the resilience of the financial system by offering market participants a choice of rates consistent with their needs. The continuity and representativeness of such key reference rates need to be ensured to prevent disruptions to the functioning of the financial markets while the specification of reference rates and the regulatory framework are being refined.

Press release © ECB

© EBF