The Federal Reserve Bank of New York has introduced the Reference Rate Use Committee (RRUC), a new initiative aimed at supporting the integrity, efficiency, and resiliency in the use of interest rate benchmarks across financial markets. This includes benchmarks produced and administered by the New York Fed.
The RRUC will address key issues related to reference rates, focusing on their evolving use and changes in the underlying markets. It aims to promote best practices, including recommendations from the Alternative Reference Rates Committee (ARRC) during the transition away from LIBOR.
John C. Williams, president and CEO of the New York Fed, emphasized the importance of this new committee: “The RRUC will serve as an essential partnership that builds upon the work and accomplishments of the ARRC, by helping to preserve a robust system of reference rates,” he said. “This work will complement international efforts at the Bank for International Settlements and the Financial Stability Board to monitor developments in the use of interest rate benchmarks and ensure that we never have to face a problem like LIBOR again.”
The RRUC continues the work started by ARRC, which facilitated a smooth transition away from U.S. dollar (USD) LIBOR before its panel ended in 2023. The lessons learned from LIBOR underscore the benefits of strong global private and public sector partnerships.
Patrick J. Howard, Deputy Chief Risk Officer of Morgan Stanley, has been appointed as RRUC’s inaugural chair. Howard joined Morgan Stanley in 2017 as Global Head of Market Risk and has extensive experience managing risk functions worldwide for U.S., Asian, and European banks. His previous roles include Chief Market Risk Officer at BNY Mellon and Global Head of Market Risk & Quantitative Risk at Nomura.
“As we saw with LIBOR, it is essential that the financial industry and public sector work closely together to support the sustainable use of reference rates,” said Howard. “I look forward to leading the RRUC as it begins this work to help safeguard the financial system.”
Further details about RRUC's activities and member organizations are available on its website. The committee plans to meet several times a year, with its first meeting scheduled for October 9.
For more information about RRUC or its upcoming meeting, visit their website or sign up for email alerts.
Contact:
Betsy Bourassa
(212) 720-6885
Betsy.Bourassa@ny.frb.org
