Revamped Euribor lending benchmark wins regulatory approval

A revamped version of the Euribor interest rate benchmark has been given regulatory approval, helping the euro area catch up with reforms aimed at avoiding a repeat of the global rate-rigging scandals. The Financial Services and Markets Authority (FSMA) of Belgium has authorized the Brussels-based European Money Market Institute (EMMI) as the administrator of Euribor under the EU Benchmark Regulation (BMR).

"Euribor is now considered BMR-compliant and was added to the ESMA (European Securities and Markets Authority) benchmark register," ESMA said in a statement on its website. "This means that European Union (EU) supervised entities will be able to use Euribor also after the end of the applicable BMR transitional period," it added, saying too that EMMI intends to apply for authorization of the equivalent overnight lending rate, EONIA, in September.

Euribor and Eonia are two of the main euro-denominated measures of money market lending rates and are widely used as a reference for pricing home loans, credit cards, and other products. Banks in Europe and the United States were fined billions of dollars over the last decade for trying to rig Euribor and its larger cousin, the London Interbank Offered Rate or Libor.