June 5, 2019 / 7:59 AM / 3 months ago

The time for 'last orders' on Libor is now - BoE's Ramsden

FILE PHOTO: Bank of England Deputy Governor for Markets and Banking, Dave Ramsden attends a Bank of England news conference, in the City of London, Britain November 1, 2018. Kirsty O'Connor/Pool via REUTERS

LONDON (Reuters) - The time has come for financial firms to make their “last orders” based on the discredited interest rate benchmark Libor, a deputy governor of the Bank of England said on Wednesday.

“Firms need to be focused on what they need to do to be able to transact Sonia-based products, and stop adding to their post 2021 Libor exposures,” Dave Ramsden said in a speech.

Libor reflects borrowing costs among banks and is based on quotes submitted by lenders. It is used as a price reference in financial contracts and derivatives worth $350 trillion (£275.5 trillion).

But banks have been fined $9 billion for trying to rig the benchmark and it is being replaced in Britain by the Bank of England’s Sonia overnight rate.

Writing by William Schomberg, Editing by Paul Sandle

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