South African Reserve Bank explains Jibar cessation delay to 31 May 2027 as legacy contract legislation remains pending

In opening remarks at the 2026 Market Practitioners Group Conference, South African Reserve Bank (SARB) Deputy Governor Rashad Cassim explained the decision to postpone cessation of the Johannesburg Interbank Average Rate (Jibar) from 31 December 2026 to 31 May 2027. The delay addresses uncertainty over legislation needed for tough legacy contracts that cannot be amended before cessation. Proposed amendments to the Financial Sector Regulation Act would allow the designation of replacement benchmarks, but still require completion of the parliamentary process and presidential assent. Clearing houses also need to align conversion of outstanding Jibar derivatives to the South African Rand Overnight Index Average (ZARONIA) with cessation to avoid basis, valuation, hedging and operational risks. The postponement does not reverse the decision to discontinue Jibar or reflect concerns about ZARONIA. Global ZARONIA derivative exposures exceeded ZAR 18.5 trillion as of September, while global Jibar derivative exposures still exceeded ZAR 98 trillion. Market participants should use the additional months to reduce Jibar exposures, complete system and contractual changes, and communicate clearly with clients and counterparties. Beyond Jibar, Cassim revisited the February 2026 consultation proposal to replace the prime lending rate with the SARB policy rate, emphasizing the need to apply lessons on consultation and cautious timetables. Work with private sector participants has also identified infrastructure and regulatory constraints in repo markets that could be addressed through further reforms.