Belgian bank-insurance firm KBC Bank has been added to the panel of banks that provide rate submissions that feed into the calculation of the financial benchmark, Euribor — the key rate used in European financial markets and products.
The administrator of Euribor, the European Money Markets Institute (EMMI), recently announced that it has added Brussels-based KBC Bank to the panel that contributes to the calculation of the benchmark, which uses a combination of transaction activity and a panel of submitting banks.
The hybrid methodology to setting the rate was adopted in the wake of the financial benchmark manipulation scandal, which led to reform in most major interest rate benchmarks — in an effort to shore up confidence in the fairness and reliability of these metrics.
The bank’s addition to the Euribor panel follows the withdrawal of U.K.-based banking giant Barclays Bank plc from the panel earlier this year.
“This development takes place as part of the regular evolution of the Euribor panel, reflecting the underlying market activity,” said Jean-Louis Schirmann, CEO of EMMI, in a release. “Panel composition naturally evolves over time, supporting the continued robustness and representativeness of the benchmark.”
The European Securities and Markets Authority (ESMA), which oversees the EMMI and the Belgian Financial Services and Markets Authority (FSMA), the regulator that supervises KBC Bank, called the move a “positive development that contributes to strengthening the robustness and reliability of this critical benchmark.”
“The addition of KBC Bank to the Euribor panel reflects the interest of financial institutions active in the money market to contribute to the calculation of Euribor, as well as continued market confidence in this key benchmark,” said Verena Ross, chair of ESMA, in a release.
“A strong benchmark enhances transparency and the availability of reliable information, which are essential to fostering trust and ensuring the smooth functioning of financial markets,” she added.
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