Is it working?

The transition is on a firm regulatory timeline and has passed two decisive milestones: Credit Adjustment Spread fixed (3 December 2025) and the No New JIBAR directive in effect (1 May 2026). The first ZARONIA-linked market instruments have been issued and traded, confirming the new benchmark is viable. However, approximately R45 trillion in total legacy JIBAR exposure remains outstanding as at end-2025, and each contract requires individual analysis and often client consent to transition. With only seven months to cessation, institutions that have not started active transition face a real operational risk. The market practitioners group (MPG) tax white paper reveals that tax aspects of the transition mechanics are still being resolved, adding complexity. The Financial Sector Regulation Act amendment for 'tough legacy' contracts must be enacted before 31 December 2026.

Actions

JIBAR cessation announced 3 December 2025. Credit Adjustment Spread fixed. FSCA/PA Joint Communication 1 of 2026 issued (March 2026). 'No New JIBAR' directive in effect from 1 May 2026. Bloomberg publishing daily ISDA fallback rates from April 2025. First ZARONIA-linked bond (Standard Bank) and first ZARONIA trade (RMB on Tradeweb) completed in early 2026. Financial Sector Regulation Act amendment for tough legacy contracts being prepared.

Are there plans?

SARB MPG Transition Approach Recommendations (December 2025) cover active contract transition, fallback language and the Financial Sector Regulation Act amendment for "tough legacy" contracts. Designated Replacement Rate notices are expected Q4-2026.

Is it on the agenda?

Yes. SARB, FSCA, PA and Cabinet Financial Cluster maintain this as an active monthly priority. The market practitioners group (MPG), a joint public-private body, is the formal implementation vehicle. The transition is a key part of SARB’s benchmark reform and financial market development agenda, overseen through the MPG. SARB communications emphasise that moving from quote‑based JIBAR to transaction‑based ZARONIA aligns South African markets with IOSCO benchmark principles and post‑LIBOR reforms. Budget and market commentary link benchmark reform to broader objectives of transparency, integrity and resilience in local financial markets.

Goals

To replace the Johannesburg Interbank Average Rate (JIBAR) with the South African Rand Overnight Index Average (ZARONIA) as the main interest‑rate benchmark, and implement robust fallback and transition arrangements across cash and derivatives markets to reduce benchmark‑manipulation risk and align with global, near risk‑free rate reforms. The transition should be completed before JIBAR is permanently discontinued on 31 December 2026.

References

• Reference Link One
• Reference Link Two
• Reference Link Three

Departments / Govt Institutions

Financial Sector Conduct Authority (FSCA) Prudential Authority South African Reserve Bank (SARB)