Regulatory Alerts2024-12-10 | 83560Plan for Promoting the Benchmark Rate Reform in 2025
The Financial Services Commission and the Bank of Korea issued a plan to transition Korea's benchmark rate system to the Korea Overnight Financing Repo Rate (KOFR) starting in 2025. The strategy mandates that major financial institutions conclude at least 10% of new interest rate swap transactions on a KOFR basis by July 2025, supported by new central clearing infrastructure and open market operation incentives. Additionally, public financial institutions and commercial banks are required to issue KOFR-based floating rate notes to expand the benchmark's usage in the bond market.
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