Linking Libor To Real Data Could End Benchmark Rate's Reign
By Evan Weinberger
Law360, New York (April 16, 2013, 7:30 PM EDT) -- International regulators on Tuesday called for anchoring the scandal-plagued London interbank offered rate and other benchmark interest rates in real transactions, a move experts say means Libor could be replaced as the global financial system's key benchmark rate, since a slowdown in interbank lending has made it reliant on estimates.
The International Organization of Securities Commissions released a consultation paper outlining principles for setting financial benchmarks, with its key position being that benchmark interest rates should be set using “observable transactions entered into at arm's length."...