TreasuryONE and ETM Analytics hosted a webinar where we discussed the implications of ZARONIA for South African businesses.
This came as the South African Reserve Bank (SARB) recently published the South African Rand Overnight Index Average (ZARONIA). ZARONIA is a financial benchmark that reflects the interest rate at which Rand-denominated overnight wholesale funds are obtained by commercial banks. ZARONIA is based on actual transactions and calculated as a trimmed, volume-weighted mean of interest rates paid on eligible unsecured overnight deposits.
The publication of ZARONIA signifies an important milestone in reforming interest rate benchmarks that are widely used as reference rates in the South African financial markets.
The webinar included the following discussion points:
- Move from JIBAR to ZARONIA
- SARB moved away from money market shortage system and transitioned to what they call surplus tiered floor system
- SA is catching up with global best practices
- Who & what is primarily affected
- Where we are in the process
- What to consider