Market Extra: U.K. and U.S. regulators see promise in bond market adoption of Libor alternatives

Regulators in the U.S. and U.K. see promise in the early adoption of Libor alternatives in parts of the bond markets, even as they call for more action on replacing the scandal-plagued benchmark.

Libor, which is slated to be discontinued at the start of 2020, currently underpins an estimated $200 trillion of financial contracts and securities. But a small, and growing, number of new securities already are being underwritten with Libor replacements ahead that deadline.

“The take-up is growing and it’s growing quite demonstrably,” Andrew Bailey, CEO of the U.K. Financial Conduct Authority, said Monday in New York at a Libor gathering hosted by the Securities Industry and Financial Markets Association.

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