What Next For LIBOR? The Wheatley Review Reports

The Review chaired by Martin Wheatley, looking into regulatory reforms that should result from the recent LIBOR problems, published its final report  on 28 September.

The hard-hitting Review concludes that LIBOR is broken, but not beyond repair, and sets out a 10- point plan for its rehabilitation.

Aims of the Wheatley 10-point plan

The plan aims to provide:

• new and robust regulation;
• a fundamental overhaul of the way LIBOR is run;
• a requirement for banks to provide evidence of relevant transactions; and
• detailed technical changes to make it much harder to manipulate LIBOR.

Conclusions of the Review

The Review reached three fundamental conclusions:

• There is a clear case for a comprehensive reform of LIBOR rather than replacing the benchmark. Replacing it would cause significant disruption to financial markets and should happen only if the benchmark were severely damaged and transition to a new, suitable replacement could be managed to