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U.S. bank regulators are calling on financial institutions to stop using a common interest rate benchmark in derivatives contracts by the end of next year, although the benchmark may live on until mid-2023.

The governors of the Federal Reserve System issued a joint statement along with the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency that said banks should stop entering into new contracts that use the London Interbank Offered Rate (LIBOR) as a reference rate “as soon as practicable” and by the end of 2021 at the latest.

The regulators’ statement coincided with an announcement from LIBOR administrator ICE Benchmark Administration Ltd. that it is proposing to cease the publication of one-week and two-month USD LIBORs by the end of 2021, and to stop publishing all U.S. LIBOR settings on June 30, 2023.

The firm is planning to launch a consultation on those proposals, which will run until the end of January 2021. Sometime after that it will make a final decision on U.S. LIBOR publication.

Previously, ICE said it would stop publishing all other LIBORs — including the British pound, the euro, Swiss franc, and Japanese yen — at the end of 2021.

Despite the fact that U.S. LIBOR may hang around until mid-2023, the U.S. regulators said that stopping new contracts is necessary to ensure a smooth transition away from LIBOR.

“Given consumer protection, litigation, and reputation risks, the agencies believe entering into new contracts that use USD LIBOR as a reference rate after December 31, 2021, would create safety and soundness risks,” their statement said.

Commenting on the developments, the chair of the U.S. Securities and Exchange Commission (SEC), Jay Clayton, issued a statement, saying the steps “establish a pragmatic, market-oriented path for managing the transition away from LIBOR.”

“We encourage registrants to proactively transition to market-based reference rates and stand ready to assist market participants,” he added.

Last week, the Canadian Securities Administrators (CSA) published a staff notice calling on Canadian firms to prepare for reforms to both Canadian and various foreign financial benchmarks.

Around the world, LIBOR is being replaced by alternative rates in a variety of markets following a series of market manipulation scandals.