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29 March 2024

Citigroup to exit Eibor setting panel

Published
By Reuters

US lender Citigroup will leave the interbank interest rate setting panel in the UAE on June 25, reducing the size of the panel to 11 banks from 12, the Central Bank said on Monday.

The move will further increase the dominance of local banks over foreign banks in the panel that determines the Emirates interbank offered rate (Eibor), which is used to price financial instruments in the Gulf's top banking centre.

A spokesman for Citi declined to comment on the reasons for its withdrawal when contacted by Reuters. The Central Bank said the exit was in line with Citi's "globally implemented policy".

The Central Bank also said on Monday that the two-month Eibor tenor would be dropped from the panel's fixings, effective on December 10.

Eibor rates run from one week to one year.

A banker familiar with Eibor, who declined to be named, said the two-month tenor was being dropped because it was rarely used. Citi's exit from the panel is unlikely to affect rates significantly, he said.

The Central Bank said the next meeting of the Eibor panel would discuss governance standards in line with recommendations by the Bank for International Settlements.