Working group on euro risk-free rates

The ECB has set up a working group, together with the Financial Services and Markets Authority (FSMA), the European Securities and Markets Authority (ESMA) and the European Commission, which is tasked with, among other things, identifying and recommending alternative risk-free rates. Such rates could serve as a basis for an alternative to current benchmarks used in a variety of financial instruments and contracts in the euro area.

The group will explore possible approaches for ensuring a smooth transition to these rates, if needed in the future.

In such a case, careful transition planning by market participants will be needed to minimise disruption to markets and consumers and to safeguard the continuity of contracts to the greatest extent possible, including contracts that currently reference a term rate rather than an overnight rate. These tasks require the involvement of public authorities and a concerted effort by all market participants to facilitate a gradual reduction in the current reliance on interbank offered rates.

Structure of the group

The working group is chaired by a private sector representative and the ECB provides the secretariat. The working group is made up of 21 credit institutions as voting members, five institutions as non-voting members and one institution as an invitee.

The four public institutions that were involved in the launch of the working group have observer status.

In addition, two subgroups on term structure and contract robustness have been established by the working group on euro risk-free rates. Their terms of reference and composition are also publicly available.

Participation in the substructures of the working group
The call for expressions of interest in participating in the working group has now ended. However, other non-banking institutions or associations are still welcome to flag their interest in contributing to the activities of the substructures reporting to the working group (see the working group’s terms of reference).

Applicants should fill in the dedicated application form provided below and send it by email to Applicants are expected to provide a brief overview of their motivation for applying and state their willingness to dedicate time and resources to any work streams to which they are allocated.

Application form

Commitment to transparency

Guidelines on EU competition law

The working group will regularly consult market participants and end users, as well as gather feedback from other public authorities. Its terms of reference are publicly available and the group will regularly report on its meetings. This is to ensure transparency throughout the entire process of identifying and adopting new risk-free rates.

Ensuring broad market acceptance is vital for the effective functioning of any alternative to existing benchmark rates.

Public consultation on the candidate euro risk-free rates

A first public consultation is currently underway to gather feedback from market participants and all other interested parties on the three candidate euro risk-free rates. It will run until 17:00 CET on 13 July 2018.

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Opportunity for index providers to present alternative RFR candidates to the working group members

The working group on euro risk-free rates is currently assessing the relevant euro risk-free rate candidates to be recommended by the working group as alternatives to the existing benchmarks. The list of criteria for the selection of the risk-free rate is public and can be consulted in the documentation of the April meeting of the working group. If deemed relevant as a potential alternative euro risk-free rate, index providers are invited to express their interest in presenting their euro benchmark to the working group. Applications can be made by sending an email to the working group secretariat at