BOT to Cease Publication of THBFIX Reference Rate After June 2023
BOT announced that the publication of the Thai Baht Interest Rate Fixing (THBFIX) interest rate reference will be discontinued after June 30, 2023. BOT made this decision after FCA announced that all LIBOR settings will either cease to be provided by any administrator or no longer be representative immediately after June 30, 2023, in the case of certain USD settings. The preparatory working group of BOT and commercial banks that was established to support the termination of LIBOR has issued guidelines for smooth transition from the THBFIX interest rate reference to the Thai Overnight Repurchase Rate (THOR).
The following are the key highlights of the guidelines for transition from the THBFIX interest rate:
- Financial institutions and businesses must accelerate contract adjustment from the THBFIX interest rate reference to THOR
- Institutions must germinate new transactions based on THBFIX interest rates, including loans, debt instruments, and derivatives, from July 01, 2021 onward.
- BOT will release a fallback rate for the TBFIX interest rate, which will be effective as a replacement for outstanding transactions from July 01, 2021.
Additionally, on March 25, 2021, BOT had issued the first floating-rate BOT bonds based on THOR (six-month term) and received positive response from the market. This positive response marks an important step in promoting the adoption of the THOR reference rate in financial transactions, with the BOT planning to issue such bonds on a monthly basis to strengthen liquidity in the bond market.
Related Links (in Thai)
- Press Release on Discontinuation of TBHFIX Interest Rate
- Press Release on Guidelines on Transition
- Press Release on THOR-Based Bonds
Keywords: Asia Pacific, Thailand, Banking, Securities, Interest Rate Benchmark, THBFIX, THOR, LIBOR, Benchmark Reforms, Derivatives, Bond Issuance, Benchmark Fallbacks, BOT
Previous Article
BCB Consults on Rules for Management of ESG Risks by BanksRelated Articles
EBA Proposes Standards for IRRBB Reporting Under Basel Framework
The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.
FED Issues Further Details on Pilot Climate Scenario Analysis Exercise
The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.
US Agencies Issue Several Regulatory and Reporting Updates
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
ECB Issues Multiple Reports and Regulatory Updates for Banks
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
CBIRC Revises Measures on Corporate Governance Supervision
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
HKMA Publications Address Sustainability Issues in Financial Sector
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
EBA Updates Address Basel and NPL Requirements for Banks
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.