The benchmark EU regulation requires a need for action that should not be underestimated - the previously relevant references LIBOR, EONIA or EURIBOR will be gradually replaced by the corresponding overnight money rates such as SOFR, SONIA or €STR.
As a result, the financial markets are undergoing far-reaching reform and the deadlines for completing the changeover are approaching:
• The FCA, the UK regulatory body responsible for administering LIBOR rates, announced some time ago that it would not use regulatory measures or other means to ensure continued provision after 2021. Although the publication of USD-LIBOR is now to be maintained until mid-2023, all companies and institutions with LIBOR financial transactions should prepare themselves in sufficient time for the elimination of these rates.
• Although the EONIA is now calculated in accordance with the benchmark regulation, market participants are also being asked to prepare for the EONIA reference rate to be discontinued in January 2022.
More financial products with new reference interest rates in retail
The capital market have already reacted to these changes and is developing more and more financial products based on the new reference interest rates available - money market transactions, derivatives and also securities based on the SOFR or the €STR can be traded for some time now.
Time to act
If you already hold such instruments in your portfolios or are planning to add these new types of financial products, it is essential to adapt your SAP system landscape.
COMPIRICUS supports you
As a consulting firm and software partner specializing in finance, we have dealt with this topic intensively. We would be happy to support you right now in getting your processes and systems ready for the reference interest rate reform: both in an advisory capacity, by evaluating the necessary adjustments in your SAP TRM. And in terms of system technology, for example by updating the FIMA in your system via the corresponding notes, adapting the customizing for you and testing the new financial transactions in detail with you.
Information and tips are also available in the recording from our first webinar series: EONIA, IBOR, €STR - The Money Market is Changing. We accompany you.
The second episode is planned for the first quarter 2021. We would be happy to send you an invitation. Just enter your e-mail address into the field below and send it to us.
- Knowledge that your project is in the hands of experts.
- Confidence in a complete end-to-end implementation.
- Legally compliant solution.
- Full solution at an optimal cost.
- You can continue to concentrate on your core business.
Please contact us if you would like to have a personal conversation or further information. We will gladly answer your questions. Please contact Jorg Pappert by telephone or by email.
Phone: +1 617 273 8045 | Email: firstname.lastname@example.org