Asia awaits term SOFR solution for local benchmarks

Singapore, Thailand and the Philippines look at ways to replace Libor in benchmark calculations

Asia’s benchmark administrators are closely watching efforts to establish a term version of US dollar Libor’s replacement, the secured overnight financing rate. The continuity of contracts that reference three South-east Asia interest rate benchmarks – and design of term risk-free rates in other Asia markets – might well depend on it.

A forward-looking term SOFR would allow the benchmark to be used instead of Libor to calculate contractual fallbacks for Singapore’s Swap Offer Rate (SOR), the