埃森哲-2019年伦敦同业拆借利率调查报告（英文）-2019.10-18页.pdf

A practical way to thrive in transition uncertaintyAccenture 2019 LIBOR SurveyLIBORATION2LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYAccentures 2019 LIBOR Survey interviewed 177 firms across the financial services industry,including investment banks,commercial and retail banks,corporates,asset managers and insurance companies.3LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYUnprepared for a Complex TransitionThough 84%of surveyed firms have a formal LIBOR transition plan,the level of preparedness is low with only 18%of respondents describing their plans as mature.In addition,many firms are undertaking multiple activities,leading to less clarity on the overall impact of the transition across business lines.Despite regulators urging preparedness,many surveyed respondents feel that LIBOR reporting and availability will not completely cease in 2021.It is thought by many across the financial services industry that the path to transition could be longer and more complicated than anticipated,with some respondents hoping regulators show similar flexibility as in the past as the looming 2021 deadline approaches.Financial services firms are largely aware of what they should do,but they seem to underestimate the complexity of the task at hand.The approaches taken by respondents to date appear siloed and not integrated across business lines and with technology functions.We also see respondents addressing transition needs in disparate ways and with varying levels of maturity.Industry Confliction and Conflicted IndustryThe 2019 LIBOR Survey highlights conflicting viewpoints regarding readiness and priorities.This indicates that respondents may lack a clear understanding of the level of granularity and focus required to address the true impact of the transition,which may lead to higher transition costs,less certainty in achieving transition goals and even adverse client and reputational impact.While over eight in ten respondents have a formal transition plan,far less(59%)have a unified and consistent transition and remediation approach.Furthermore,a quarter plan to allocate funds to product design over the next three years while one in seven plan to invest in technology and about one in ten in legal remediation,critical areas to an effective transition.Of equal concern,while half the respondents agree that the transition provides an opportunity to be more client driven,less than a tenth of the respondents expect to fund client outreach activities.The emerging narrative from the survey was a mixed picture of preparedness for the upcoming London Interbank Offered Rate(LIBOR)transition.With the 2021 deadline for when the Financial Conduct Authority(FCA)will cease requiring LIBOR banks to report fast approaching,survey respondents seem under prepared with less than 20%describing their transition program as mature.Key survey findings include:4LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYIs Overconfidence Increasing Risk?Survey responses also point to a certain level of overconfidence for what can be described as a demanding and complicated transition.Though the survey and our client discussions show broad understanding of the key steps to take to transition,there is a lack of detailed thinking,planning and decision making around strategy and where to prioritize investments.As well,LIBOR-exposed firms are challenged in assessing their risk exposure and the effectiveness of controls given the expected transition journey.They are also challenged in how to measure and quantify risk and in how to enhance and update product offerings within current risk tolerance levels to capture more value from their business and risk management programs.Another challenge is aligning the proper level of preparedness across different business lines and products while balancing uncertainties,resource capabilities and transition risks such as operational,technological,and reputational risks.This optimism extends to the beliefheld by nearly a quarter of survey respondentsthat the 2021 deadline may be pushed back.This overconfidence,which exposes financial firms to increased risk,can result in real financial consequences and missed opportunities.Drivers and Passengers on the Path to 2021Transitioning away from LIBOR,which has been used as a global benchmark rate for many decades puts financial firms in a unique situation.While some are choosing to actively“drive”a remediation and transition program across their organization to meet the deadline,others are taking a passive stance.Typically,the large investment banks and capital markets participants are the“drivers,”as they are the ones who will set and trade these benchmark rates,while the“passengers”are the corporate and asset management clients who are users of these rates.Technology also plays an important role in this dynamic.Firms that can quickly onboard tech solutions should create liquidity and thus assume the role of drivers.As for passenger types,they appear to show a reduced level of understanding concerning the impact of the transition,and are not pushing the agenda,but waiting for the investment banks to“solve the problem.”Across the financial services industry,firms should balance their response and assess how passive or dynamic to be in their approach and spend to achieve an orderly and timely transition.5LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYUNPREPARED FOR A COMPLEX TRANSITIONUsed in the market since 1986,LIBOR currently underpins around$400 trillion in financial contracts for derivatives,bonds,mortgages,commercial and retail loans.As LIBOR is integral to capital markets,and the banking,insurance and asset management products they underpin,the shift to risk-free rates(RFRs)could possibly be the greatest challenge facing financial firms today.1 During his tenure at the Federal Reserve Bank of New York,then President and CEO William Dudley referred to the transition as“a monumental and complicated effort one that the industry has never undertaken and it will entail overcoming many obstacles.”2 The turning point and major shift in the market appears to be the December 2018 issuance by the FCA of the Dear CEO letter requesting that firms submit evidence of their transition plans and demonstrate their approach to transition.4 This prompt led to the development in late 2018-early 2019 of high level plans,but in April 2019 the Federal Reserve Vice Chair indicated that the banking industry was still not moving fast enough.5This remains evident in our survey,where only 18%of respondents describe their plans as mature.Similarly,just 20%of respondents describe themselves as being operationally ready to execute the LIBOR transition.Such a significant and complex transition demands that market participants have detailed,integrated and unified transition plans and capabilities in place to effectively execute their transition.However,the depth and quality of the plans currently indicate a lack of preparedness,as only 41%of 2019 LIBOR Survey respondents claim that they do not have a unified or consistent approach to LIBOR transition and remediation across their multiple business lines and functions.While the majority of firms(84%)surveyed have a formal transition plan in place,the maturity of their plans is somewhat limited,with only around a third indicating that their transition plans have been in place for more than a year.Lower level planning of granular detail and transition activities appear to have only begun in earnest in 2019,despite requests from regulators as early as the summer of 2018 to begin transition planning and execution.3 6LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYTwo areas of particular concern among the survey findings are the legal departments readiness and capabilities and the risk management function.Only 15%of respondents indicate their legal teams are ready to deal with the numerous contract remediation,deal restructuring and repapering activities at the scale required for their legacy contract backbook and to support the issuance of new RFR-referencing products.The survey also finds that only 14%claim that their risk management teams have a detailed understanding and plan of the transition activities and the impact of those plans on risk management for the current book,as well as for any renewals and/or rollovers and new originations.This implies that:Respondents lack clarity on how much spend and effort is required to undertake the transition.Their plans are not as complete as they should be,especially among financial services firms outside the investment banking space.They lack consistency and commitment in stakeholder engagement across their enterpriseAnd based on the survey findings,planned spending over the next three years in critical areas such as technology(14%),operations(17%),and client outreach(8%),the transition across the industry lacks momentum,and that the estimated$155 billion in technology and business spend is probably an underestimation.According to the 2019 LIBOR Survey,43%of respondents with immature transition programs feel that regulatory uncertainty is holding back their transition efforts.The lack of preparedness in these areas and general inconsistency across business lines also extends to geographies.Nearly half(47%)of respondents indicate that they are not confident that they understand the regulatory expectations across jurisdictions;and further compounding this,21%say they have had no contact with regulators around LIBOR transition.Going into late 2019,40%of respondents state that there remains significant regulatory uncertainty and lack of clarity,which is actively hampering the execution of their remediation efforts.However,the FCA,together with other global regulators,continues to emphasize that the 2021 end date for the discontinuation of LIBOR will not be delayed,and,while the survey indicates that half the respondents expect some sort of relief from regulators,this is not the message coming from the governing bodies.At a Securities Industry and Financial Markets Association(SIFMA)conference on July 15th,2019 representatives from both the Federal Reserve and the FCA reiterated that firms should not think that they“will be able to force the continuation of LIBOR beyond the end of 2021.”6 The Securities and Exchange Commission(SEC)have also emphasized that“The risks associated with this discontinuation and transition will be exacerbated if the work necessary to effect an orderly transition to an alternative reference rate is not completed in an orderly manner.”7With so many complex factors in play,are financial firms taking a gamble that can backfire given their lack of preparedness and the belief that regulators will delay the transition?The consequences of holding illiquid assets benchmarked to an obsolete rate can have material financial consequences,including capital and liquidity issues.It can also result in increased spend and budget requirements to be allocated within a truncated timeline if action is not taken promptly.As the evidence to date suggests no such delay,we encourage financial firms,if they have not already done so,to begin planning in earnest for this important transition.As Randal Quarles,Federal Reserve Vice Chairman for Supervision,firmly stated,“Regardless of how you choose to transition,beginning that transition now would be consistent with prudent risk management and the duty that you owe to your shareholders and clients.”87LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYINDUSTRY CONFLICTION AND A CONFLICTED INDUSTRY What emerges from our 2019 LIBOR Survey is that firms have a conflicting perspective on how prepared they should be for the transition,with contradictory viewpoints on areas of focus.This may indicate that respondents are challenged in prioritizing their transition activities and lack a clear path to clarifying what they“need to know”to respond effectively.Consistent with the findings pointing to a general lack of readiness for the LIBOR transition,only 45%of respondents state that they had allocated (or plan to allocate)sufficient funding to their LIBOR transition.Our analysis also indicates that two-thirds of respondents plan to spend under$100 million on their LIBOR transition.In contrast,respondents with a mature transition program plan,on average,to spend upwards of$142 million,while a group of forward-looking firms(13%)plan on spending over$200 million on their transition.Surprisingly,a solid majority of respondents either do not have the funding in place or are under-investing.The concern in our view is that these respondents are underestimating the thorny demands and complexity of the transition and increasing the likelihood theyll need additional budgets and resources to properly complete the transition on time.Even where budgets are in place,respondents funding priorities point to a conflicted understanding of where the largest impacts can be made.Nearly a quarter(23%)of respondents plan to allocate funds to product design over the next three years,while only 17%plan to allocate funds to risk models and 14%to technology,raising the issue that there is a dichotomy within firms as to where to allocate resources and attention.This struggle speaks to a lack of clarity among firms on the importance of prioritizing necessary skills and align these with staffing needs.The understanding of where priorities lie,is key to adequately staffing across business and technology functions.The inability to properly address this may result in areas of firms LIBOR programs struggling to meet people and technology objectives without significant increases in funding throughout 2020-2021.8LIBORATION A PRACTICAL WAY TO THRIVE IN TRANSITION UNCERTAINTYFurthermore,38%of survey respondents believe the incremental revenue from the transition(for example,through the launch of new RFR products and new front office revenue streams)can offset the cost of remediation over the next three years.About the same number(34%)do not believe this.This may explain why so many individual firms have not sufficiently funded their transition,or it may indicate an overly optimistic estimate of the commercial opportunities the transition presents.Nonetheless,the lack of consensus among respondents is clear,and new commercial opportunities should be carefully managed.We recommend that as firms consider their commercial strategy,they should validate how this exposes their organization to conduct risk and suggest the following actions:Invest in training and upgrading of compliance and surveillance programs in order to monitor any misconduct in new product trading in a post-LIBOR environment.“the base case assumption for firms planning should be no LIBOR publication after end-2021.”Andrew Bailey,Chief Executive of the Financial Conduct AuthoritySource:LIBOR:Preparing for the end,Financial Conduct Authority,July 15,2019This lack of industry consen