About a-team Marketing Services
The knowledge platform for the financial technology industry
The knowledge platform for the financial technology industry

A-Team Insight Blogs

Life After LIBOR – Keep Calm and Cover Your Contracts

Subscribe to our newsletter

The use of LIBOR is drawing to a close – but will you be a winner or a loser when it comes to dealing with the data management fallout from the transition? The move away from the  world’s most widely-used interbank rate is raising all sorts of data challenges – and with considerable ambiguity remaining around how the final stages will be executed – especially with regards to benchmark replacements in markets outside the UK – there are still many questions that need to be answered.

So what are the key LIBOR-related data management challenges, and what are the major gaps that need to be filled?

“The technology related gaps are two-fold, finding all the Libor related fields, code and contracts,” explains Susan Laine, VP of Strategic Sales at ASG Technologies. “And the second, is what is the impact of making changes here – do we need to replace it and what will be the impact to both the business and the technical data landscape? Clients soon need to get their arms around the scope of the changes, how long it will take and how far reaching is this impact.”

The situation is urgent – but instead of viewing the LIBOR transition as just another costly, resource-consuming exercise, why not approach it as a platform through which to improve your data management game, better understand your data and reorganize your approach to gain competitive advantage?

To deal with this transition, organizations must first execute a comprehensive inventory of data – where are the data assets and how will they be affected? Next, that data must be contextualized – what lines of business do they fall under and how much exposure will they incur? Finally, it must be evaluated – how do you calculate that risk, how is it modelled, how will a new offering rate alter that risk calculation and how can that data be transformed into the correct format? But there are other considerations too. For example, how will the LIBOR transition interact with other regulations, and how is that likely to impact your business?

“We believe the impact will be wide, and the focus is on bank capital and liquidity regulations,” reveals Laine. The transition also has far-reaching implications for analytical calculations for risks in areas such as market/credit, liquidity and operations, as well as impacting firms in terms of conduct and reputation, with intense scrutiny expected from the regulators to ensure strategy control and org-readiness.

So what should you be doing about it – and where should you start, if you haven’t already? Laine suggests enlisting a data intelligence solution that supports activities such as automated inventories, catalogues, data lineage and global search type features. “It’s helpful to query unstructured information as well for archived contract information and such,” she explains.

To learn more about opportunities and benefits that the LIBOR transition could present for your firm, register for our upcoming webinar, ‘How to leverage the LIBOR transition to improve your data management game,’ and hear from industry leading experts on the key challenges, upcoming stages and potential solutions in the run-up to LIBOR’s final retirement. 

Subscribe to our newsletter

Related content

WEBINAR

Upcoming Webinar: Best practices for data lineage and metadata management to support evolving data operations

Date: 20 October 2022 Time: 10:00am ET / 3:00pm London / 4:00pm CET Duration: 50 minutes Data lineage is key to tracking data from source to consumption and any changes to the data along the way. Metadata management provides governance and control, ensuring high quality, consistent and accurate data across a financial institution. It can...

BLOG

Bank of England and FCA Review Joint Transformation Programme Dedicated to Data Collection

The Bank of England and Financial Conduct Authority (FCA) have provided an update on the joint transformation programme they set up in 2021 to overhaul data collection from UK financial services firms. The aim is to improve regulation of regulated firms and ease the burden of reporting for these firms. The programme is expected to...

EVENT

A-Team Innovation Briefing: Innovation in Cloud

This Innovation Briefing will explore approaches to data infrastructure transformation, technologies required and how to make sure processes are optimised to support real time data management. Hear from leading practitioners and innovative technology solution providers who will share insight into how to set up and leverage your data infrastructure to provide user access to consistent data and analytics, and companies the ability to monetise their data.

GUIDE

ESG Data Handbook 2022

The ESG landscape is changing faster than anyone could have imagined even five years ago. With tens of trillions of dollars expected to have been committed to sustainable assets by the end of the decade, it’s never been more important for financial institutions of all sizes to stay abreast of changes in the ESG data...