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Bank of Russia sets deadline for switching to financial benchmarks that meet international standards

25 January 2022

Market participants should switch to using benchmarks that comply with relevant international standards in their financial instruments and agreements by 1 January 2024. Possible barriers for such transition and ways for eliminating them are addressed in the Bank of Russia’s information and analytical commentary.

The global economy is completing the reform of financial benchmarks. This reform provides for the transition from indicative interest rates to alternative benchmarks calculated based on actual transactions.

The international standards on financial benchmarks are the IOSCO Principles for Financial Benchmarks approved by the Financial Stability Board (FSB) and recognised by the G20 leaders. The FSB and the IOSCO emphasise that the reliability of interest rate benchmarks intended for broad use should be as high as possible.

Administrators are advised to bring their benchmarks in compliance with the IOSCO principles and take all necessary measures, including to develop transition plans and fallback provisions.

Such transition will enable reliable and transparent pricing of financial market instruments, enhance the protection of interests of all investor groups, and promote harmonisation with international practice.

Comments on the information and analytical material will be accepted until 25 February 2022.

Preview photo: Siamionau Pavel / Shutterstock / Fotodom