TOKYO (Reuters) - Japan is considering on-site monitoring for financial firms to push migration from Libor, according to the results of a regulatory survey seen by Reuters, as the scandal-hit interest rate benchmark will cease to exist by the end of 2021.
Such a move would be a visible sign that Japanese regulators are keen to put more pressure on financial firms to move away from the benchmark. Regulators globally are urging banks to ditch Libor and shift to new rates.
The Financial Services Agency and the Bank of Japan found a massive 6,500 trillion yen ($61 trillion) worth of Libor-related contracts including loans, bonds and derivatives in the country’s 278 financial firms, the survey, which has yet to be released, showed.
The London Interbank Offered Rate (Libor) is based on polls of selected banks, and lenders were fined billions of dollars for trying to manipulate their submissions during the financial crisis a decade ago.
Reporting by Takashi Umekawa and Takaya Yamaguchi; Editing by David Dolan