The EACB welcomes the opportunity to participate in this consultation, as it allows for the review of the Benchmarks Regulation (BMR) particularly with respect to the ”functioning and effectiveness of the rules applicable to critical benchmarks”.
The EACB appreciates the good work carried out by the different stakeholder groups such as the ECB RFR WG, the European Money Markets Institute (EMMI) that is the critical benchmark administrator of Euribor and EONIA, as well as, the college of supervisors, in ensuring that the reformed critical benchmarks are BMR-compliant. This is important to ensure accuracy and reliability of indices used as benchmarks in financial instruments and contracts, thus contributing to an adequate level of consumer and investor protection.
However, we are mindful of certain transition risks to banks in the process of updating financial contracts to be based on the new Euribor with a hybrid methodology developed by EMMI (“hybrid Euribor”), as well as, the reformed EONIA based on the €STR benchmark created by the RFR WG.
Our main comment would thus be that the BMR should provide as much legal certainty for banks and their clients as possible in that the use of the reformed critical benchmarks do not constitute the cessation or a material change of the original benchmark.