Rate-fixing scandals across the globe, including the US, the UK, Japan, and Singapore have triggered the need to enhance the credibility and transparency of financial benchmarks.
The JBA intends to scrutinize the rate settling process and will incorporate other steps recommended by the International Organization of Securities Commissions (IOSCO).
Japan’s banking industry group formed the Working Committee on TIBOR under its ambit to inspect specific measures in consultation with experts and other concerned parties, and prepare a report on measures to enhance credibility of the JBA TIBOR.
It will implement all measures to enhance the reference banks’ governance system, set up a standard code of conduct to dictate matters relating to submit rates and defining necessary systems that must be established.
Further, plans are in place to form an organization that will be responsible for management and administration of TIBOR, as well as establish a dedicated oversight committee to supervise the management and administration of TIBOR.
As part of the new plan, JBA is also planning to appoint external audits to enhance the governance and transparency of benchmark publication services of the JBA.
