Last week British authorities and Martin Wheatley, the U.K.’s chief financial regulator, announced changes to improve the accuracy and reliability of Libor during a press conference in London. This follows recent EU parliamentary hearings on the subject. 

Mr. Wheatley’s recommendations include closer regulatory scrutiny, better governance and more accountability for banks contributing to the rate. The reforms will also remove the British Bankers’ Association as the administrator of the rate and will hold an open competition to find a new, independent organization to run Libor.

Bloomberg CEO Dan Doctoroff had this to say about Wheatley’s recommendations:

“The speech is indicative of the extraordinary work Mr. Wheatley and his team have accomplished in an extremely short period of time. I agree with the observation that Libor cannot be immediately replaced, but must be immediately reformed, as I stated in my testimony at the European Parliament’s hearing on Monday (September 24th). Importantly, Mr. Wheatley’s speech recognizes and encourages the ongoing international debate regarding alternatives for Libor in the longer term. Bloomberg is consulting broadly with stakeholders to develop an index that will address this critical need — an index characterized by accuracy, transparency, impartiality and data-based objectivity.”

Bloomberg has proposed its own alternative to Libor, Blibor, a data-based index, which would more accurately measure the rate at which banks lend to each other, using actual market transactions, rather than estimates.

The EU Parliament’s Economic and Monetary Affairs Committee is expected to vote on Oct. 8th on related Libor market issues.

To read Dan Doctoroff’s testimony at the EU parliamentary hearing on Libor and learn more about the Blibor alternative visit here.

Darren Grubb, Bloomberg Communications