EC to replace Swiss franc Libor and Eonia with new risk-free benchmark rates

New "risk-free" benchmark rates will replace the Swiss franc London interbank offered rate, or Libor, and the Euro overnight index average, or Eonia, beginning Jan. 1, 2022, the European Commission said.

Saron, or the Swiss average rate overnight, was nominated to replace the Swiss Libor, while Eonia will be replaced by the euro rate €STR.

The commission said the replacement will be automatic at the start of 2022 and contracts can continue without the need for contract parties' intervention.

Both the Swiss Libor and Eonia will cease being published at 2021-end.