No data available for the deliverable: Transitioning cash market products (loans, bonds, money market instruments) from JIBAR to ZARONIA by defining a fallback methodology: compounded ZARONIA + credit adjustment spread (CAS)
No data available for the deliverable: Transitioning cash market products (loans, bonds, money market instruments) from JIBAR to ZARONIA by defining a fallback methodology: compounded ZARONIA + credit adjustment spread (CAS)
No data available for the deliverable: Transitioning cash market products (loans, bonds, money market instruments) from JIBAR to ZARONIA by defining a fallback methodology: compounded ZARONIA + credit adjustment spread (CAS)
No data available for the deliverable: Transitioning cash market products (loans, bonds, money market instruments) from JIBAR to ZARONIA by defining a fallback methodology: compounded ZARONIA + credit adjustment spread (CAS)
No data available for the deliverable: Transitioning cash market products (loans, bonds, money market instruments) from JIBAR to ZARONIA by defining a fallback methodology: compounded ZARONIA + credit adjustment spread (CAS)
Summary
The reform adopts a compounded ZARONIA plus credit adjustment spread (CAS) fallback, with ISDA protocols and cash market conventions to guide the transition.
View DetailsIs it working?
The reform is progressing, with strong regulatory support and industry engagement, but full transition will require sustained effort. JIBAR cessation is scheduled for December 2026 with ongoing monitoring and support.
Actions
The derivatives market is transitioning well, but cash market adoption is slower. Legacy contract remediation and liquidity-building will continue through 2026.
Are there plans?
ISDA protocol and cash market conventions are in place, with regulatory exemptions and daily CAS publication by Bloomberg/ISDA.
Is it on the agenda?
The SARB, FSCA and Market Practitioners Group have prioritised this reform, with final methodology published in March 2025.
Goals
To ensure an orderly transition for cash market instruments from JIBAR to ZARONIA, minimising value transfer and systemic risk.
Documents
Departments / Govt Institutions
Summary
SARB worked with market participants to transition cash market benchmarks (loans, bonds, MMIs) from JIBAR to ZARONIA; fallback methodology is now defined, using compounded ZARONIA and credit spread (CAS). Methodology for cash market fallback agreed and published. Also launched were new contract conventions, daily CAS publication via Bloomberg and a regulatory/supervisory programme, conducted by SARB and the Market Practitioners Group (MPG) - a public-private sector body established by SARB in 2018. SARB and MPG have transitioned cash/bond/MMI markets to ZARONIA + CAS with fallback methodology, phasing out JIBAR, with final contracts shifting in 2025. Daily compounded ZARONIA, CAS are being published, with contractual fallback events formalised and residual contracts scheduled for conversion by Q2 2026.
Is it working?
ZARONIA/CAS reform was well received; sector benchmarks have been accepted by markets and operational risks are declining. Fallback reform was also well received, with adoption proceeding according to SARB/MGP plan.
Actions
SARB has adopted ISDA fallback protocols, delivered regulatory guidelines and catalysed the migration of legacy products. Proactive sector communication is ongoing. Market participants have migrated products on schedule, and regulatory communication and fallback protocols are in force.
Are there plans?
SARB and MPG plan continued market transition monitoring, term rate assessment and stakeholder engagement, plus further education/policy updates in 2026. Stakeholder consultation, education, regulatory updates and full industry migration are in progress.
Is it on the agenda?
Cash market benchmark reform is featured in SARB, Financial Markets Committee and PA strategies, with monthly reporting to the Cabinet Financial Cluster. SARB Financial Markets, Prudential Authority, and Cabinet Financial Cluster mark this for ongoing review.
Goals
Align cash/derivative markets to global risk-free rate reform, reduce systemic risk from JIBAR. Transition market benchmarks and mitigate systemic risk exposure.
Documents
Departments / Govt Institutions
Summary
SARB and the Market Practitioners Group (MPG) have led the transition of cash, bond and money‑market instruments from JIBAR to methodologies referencing compounded ZARONIA plus a credit‑adjustment spread (CAS). Daily compounded ZARONIA and CAS are now published, contractual fallback events have been formalised and most legacy contracts have migrated, with residual contracts scheduled for conversion by Q2 2026. Budget Review 2026 references ZARONIA as the primary nearly risk‑free rate in South Africa’s interest‑rate benchmark landscape, confirming that the reform is entering its final clean‑up phase.
Is it working?
The reform has been well received, with widespread adoption of ZARONIA/CAS fallbacks and declining reliance on JIBAR, materially reducing benchmark discontinuation risk. Remaining work relates mainly to cleaning up residual contracts and ensuring smaller institutions’ systems and models are fully adapted, but overall the transition is regarded as a success.
Actions
SARB and MPG have agreed and published the fallback methodology, adopted ISDA‑aligned protocols, ensured daily publication of ZARONIA and CAS, issued regulatory and supervisory guidance, and overseen extensive industry migration and education.
Are there plans?
SARB and MPG plan continued monitoring of migration progress, further stakeholder engagement where residual legacy exposures remain, and post‑implementation reviews of benchmark robustness and market functioning, including consideration of any future term‑rate needs.
Is it on the agenda?
Benchmark reform remains on the agendas of SARB’s Financial Markets Department, the Prudential Authority and the Cabinet financial‑cluster and is referenced in Budget Review 2026 as part of maintaining financial‑market integrity and stability.
Goals
Transition cash, bond and money‑market instruments from JIBAR to robust ZARONIA‑based benchmarks and fallbacks, reducing benchmark and systemic‑risk exposure and aligning with global risk‑free‑rate reforms.
Documents
Departments / Govt Institutions
Summary
SARB formally announced JIBAR's permanent discontinuation on 3 December 2025, simultaneously fixing the Credit Adjustment Spread (CAS - a small margin added to ZARONIA to compensate for the economic difference between JIBAR and ZARONIA on legacy contracts). The FSCA and the PA issued Joint Communication 1 of 2026 in March 2026, setting out supervisory expectations, while the regulatory directive requiring no new JIBAR-linked contracts came into formal effect on 1 May 2026. The first ZARONIA-linked bond was issued by Standard Bank and the first ZARONIA-linked trade was executed on the Tradeweb platform with Rand Merchant Bank (RMB) in early 2026. SARB's Market Practitioners Group (MPG - a joint public-private body) published a tax white paper on transition implications, with public comments due 21 May 2026. Full JIBAR cessation is expected by 31 December 2026 after which ZARONIA becomes the primary benchmark from 1 January 2027.
Is it working?
The transition is on a firm, legally anchored timeline. The 'No New JIBAR' directive (in effect from 1 May 2026) caps growth of new legacy exposure. The first ZARONIA-linked instruments have been issued and traded, confirming the market is accepting the new benchmark. However, approximately R45tn in total financial exposure still references JIBAR and needs to be transitioned before 31 December 2026. Each contract requires individual analysis and often client consent to change.
The MPG tax white paper confirms that the tax treatment of transition mechanics is not yet fully resolved. The Financial Sector Regulation Act amendment for "tough legacy" contracts must be enacted before year-end. Institutions that delay active transition face a genuine operational risk as the deadline approaches.
Actions
Key actions include: JIBAR cessation announced 3 December 2025; Credit Adjustment Spread fixed; FSCA/PA Joint Communication 1 of 2026 issued; 'No New JIBAR' directive in effect from 1 May 2026; Bloomberg publishing daily ZARONIA-plus-CAS rates from April 2025; Financial Sector Regulation Act amendment being prepared for 'tough legacy' contracts.
Are there plans?
SARB MPG published detailed Transition Approach Recommendations in December 2025; these covered: how to transition legacy JIBAR contracts to ZARONIA; fallback language for new contracts; and how to handle "tough legacy" contracts (older contracts without adequate fallback provisions) through an amendment to the Financial Sector Regulation Act. Designated Replacement Rate notices (formal government announcements confirming ZARONIA as JIBAR's replacement for specific contract types) are expected in Q4-26.
Is it on the agenda?
Yes. This reform is actively monitored by SARB, the PA, FSCA and the Cabinet Financial Cluster. The Market Practitioners Group (MPG), a joint public-private body, is the formal implementation vehicle.
Goals
To replace the JIBAR interest rate benchmark (which has been the reference rate for trillions of rands in South African loans, bonds and financial contracts) with the new, more robust ZARONIA benchmark. An interim goal is to manage the transition for all existing contracts that reference JIBAR before it is permanently discontinued on 31 December 2026.
Documents
Departments / Govt Institutions
Summary
SARB formally announced JIBAR's permanent discontinuation on 3 December 2025, simultaneously fixing the Credit Adjustment Spread (CAS - a small margin added to ZARONIA to compensate for the economic difference between JIBAR and ZARONIA on legacy contracts). The FSCA and the PA issued Joint Communication 1 of 2026 in March 2026, setting out supervisory expectations, while the regulatory directive requiring no new JIBAR-linked contracts came into formal effect on 1 May 2026. The first ZARONIA-linked bond was issued by Standard Bank and the first ZARONIA-linked trade was executed on the Tradeweb platform with Rand Merchant Bank (RMB) in early 2026. SARB's Market Practitioners Group (MPG - a joint public-private body) published a tax white paper on transition implications, with public comments due 21 May 2026. Full JIBAR cessation is expected by 31 December 2026 after which ZARONIA becomes the primary benchmark from 1 January 2027.
Is it working?
The transition is on a firm, legally anchored timeline. The 'No New JIBAR' directive (in effect from 1 May 2026) caps growth of new legacy exposure. The first ZARONIA-linked instruments have been issued and traded, confirming the market is accepting the new benchmark. However, approximately R45tn in total financial exposure still references JIBAR and needs to be transitioned before 31 December 2026. Each contract requires individual analysis and often client consent to change.
The MPG tax white paper confirms that the tax treatment of transition mechanics is not yet fully resolved. The Financial Sector Regulation Act amendment for "tough legacy" contracts must be enacted before year-end. Institutions that delay active transition face a genuine operational risk as the deadline approaches.
Actions
Key actions include: JIBAR cessation announced 3 December 2025; Credit Adjustment Spread fixed; FSCA/PA Joint Communication 1 of 2026 issued; 'No New JIBAR' directive in effect from 1 May 2026; Bloomberg publishing daily ZARONIA-plus-CAS rates from April 2025; Financial Sector Regulation Act amendment being prepared for 'tough legacy' contracts.
Are there plans?
SARB MPG published detailed Transition Approach Recommendations in December 2025; these covered: how to transition legacy JIBAR contracts to ZARONIA; fallback language for new contracts; and how to handle "tough legacy" contracts (older contracts without adequate fallback provisions) through an amendment to the Financial Sector Regulation Act. Designated Replacement Rate notices (formal government announcements confirming ZARONIA as JIBAR's replacement for specific contract types) are expected in Q4-26.
Is it on the agenda?
Yes. This reform is actively monitored by SARB, the PA, FSCA and the Cabinet Financial Cluster. The Market Practitioners Group (MPG), a joint public-private body, is the formal implementation vehicle.
Goals
To replace the JIBAR interest rate benchmark (which has been the reference rate for trillions of rands in South African loans, bonds and financial contracts) with the new, more robust ZARONIA benchmark. An interim goal is to manage the transition for all existing contracts that reference JIBAR before it is permanently discontinued on 31 December 2026.
Documents
Departments / Govt Institutions