The EURIBOR and EONIA Reform: Achieving Regulatory Compliance While Protecting Financial Stability

Abstract

This article describes the events leading up to the EURIBOR reform and the efforts to make EURIBOR compliant with the European Benchmark Regulation. It also explains the actions undertaken to transition from EONIA towards €STER and the reasoning behind the choice to recalibrate EONIA into €STER plus a spread. Although EURIBOR is considered BMR-compliant since 2 July 2019 and EONIA can continue to be used until 3 January 2022, this article explains why market participants should not be dis-incentivized to already take actions to provide for fallback rates to EURIBOR in their legal documentation, and to move away from EONIA.