By the end of 2021, the smorgasbord of benchmark borrowing costs known as the London interbank offered rate (LIBOR) is due to die. Rendered archaic by shifts in the wholesale money markets, not to mention sullied by rigging, the world's regulators have deemed LIBOR no longer fit for purpose.

And yet… the effort to replace LIBOR is "the largest financial engineering project the world has ever seen," Darrell Duffie, a finance professor at Stanford University, said last week. Dubbed in the past "the world's most important number" by the British Banking Association, the body that used to oversee it, LIBOR is proving almost impossible to kill off.

With less than three years to go before LIBOR is scheduled to end, a new study by the International Swaps and Derivatives Association (ISDA) shows that the interest-rate derivatives market continues to rely on the old benchmark. Just 2.5 percent of the $70 trillion of contracts traded in the first quarter were tied to LIBOR's suggested replacements, which include the Secured overnight financing rate (SOFR) in dollars and the sterling overnight index average rate (SONIA) in U.K. markets.

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