turbo - charging sterling libor transition : why 2020 is the year for action – and what the bank of england is doing to help speech given by andrew hauser, executive director, markets international swaps and derivatives association / sifma asset management group benchmark strategies forum, london wednesday 26 february 2020 i am grateful to sarah hall for co - writing this speech – and to amber evans, alastair hughes, wayne leslie, will parry, rhys phillips, edwin schooling latter, dave ramsden and francesca zwolinksy for their advice and comments. all speeches are available online at www. bankofengland. co. uk / news / speeches introduction 2020 is a critical year for libor transition. great progress was made in 2019, particularly in sterling wholesale markets – and i want to give special thanks to the part that isda ’ s support and leadership has played in that. but, with the finish line for libor now clearly in view, there is still a lot of ground to cover – particularly in the cash markets. we need to see another decisive acceleration in effort in 2020 to ensure risk - free rates are adopted across the full range of sterling business, and libor is left behind for good. the motor racing analogy is apt, because libor transition is complex, fast - paced and – above all – a team effort. the green lights came on some time ago, and the private sector has been decisively – and rightly – leading from the front. the chronic lack of underlying transactions1 means that libor is simply too fragile a benchmark to support a sustainable business model – indeed its continued existence poses material risks to financial stability, both in the uk and globally. that ’ s why in the race to say goodbye to libor, it is firms ’ own business leads, project managers and subject matter experts that are designing and driving the cars, supplying the tyres, and running the pit crews – re - engineering systems, innovating new financial products and services, and delivering them to customers. but it ’ s not just a firm - by - firm effort : it ’ s cross - market too. under the leadership of tushar morzaria, barclays ’ cfo, the sterling risk free rate working group and its various offshoots have brought together over 200 industry experts to solve collective problems. that includes setting the route map to the chequered flag – the latest version of which was released in january ( figure 1 ). 2 amongst many

£50 character selection and future forum launch remarks given by mark carney, governor of the bank of england science museum, london friday 2 november 2018 i am grateful to clare macallan and jennifer nemeth for their assistance in drafting these remarks and to lizzie levett, emma sinclair and toby davies for providing background information. all speeches are available online at www. bankofengland. co. uk / publications / pages / speeches / default. aspx it is always a pleasure to visit the science museum. its galleries and exhibitions showcase the rich history of human ingenuity in the sciences, technology, and medicine. you might think that the bank of england has little in common with such lofty endeavours, but science spans all aspects of life, extending even to central banking. within this mathematics gallery alone, there are multiple examples of where the worlds of central banking and science converge. take the moniac machine, which illustrates the circular flow of income around the economy using an assortment of pipes and coloured water. or babbage ’ s analytical engine, developed in collaboration with mathematician ada lovelace. this precursor to modern computers helped estimate mortality rates, techniques that are still central to underwriting life insurance policies today. the same life insurers that we regulate at the bank of england. among those who are supervising, modelling and policymaking, are the bank ’ s very own scientists. almost 10 % of colleagues across the bank have a science or maths degree and 1 in 10 of our graduates starting this year studied chemistry, biology or physics at university. we very much value the skills and diversity they bring to our efforts, so in a short recruitment pitch, when you ‘ think science ’, think too of central banking. after all, science starts with curiosity and asking the right questions. science teaches people to conduct dedicated research and disciplined analysis. these skills and talents make a good supervisor, policymaker or senior leader, and they are the reason that the bank increasingly recruits from beyond the field of economics. not least because scientific advances in artificial intelligence and machine learning are reshaping our world, transforming the nature of both work and commerce. this revolution will impact all aspects of the bank ’ s work, from the future of work, through its effects on employment, productivity and wages, to the future of finance, as the nature of customer service, trading and risk management transforms. these advances in science and technology are also transforming our focus today – money. they are making digital money