EURIBOR
EURIBOR is a euro money-market reference rate administered by the European Money Markets Institute. Its underlying interest concerns unsecured wholesale euro funding available to credit institutions and it is published for specified tenors. It differs from overnight risk-free reference rates in underlying market and maturity. A floating-rate contract may reference a specified EURIBOR tenor plus a margin, subject to its reset and calculation terms. It is not the former US dollar or sterling LIBOR benchmark.
Worked example
A loan resets every three months at three-month EURIBOR plus 2 percentage points. If its contractual reset fixing is 3%, the indicative annualised rate for that interest period is 5%, before applying the specified day-count convention.
Common mistake
Assuming EURIBOR and discontinued LIBOR are interchangeable, or using an overnight rate when the contract specifies a three-month tenor.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | AFM | Supporting | September 2026–June 2027 |
| ACCA | FM | Supporting | September 2026–June 2027 |