TIBOR

Financial institutions, corporations and institutional investors that reference TIBOR in loans and interest rate swaps receive its value from data vendors and use it in their transactions.

What TIBOR is and its two features

TIBOR (Tokyo Interbank Offered Rate) is a benchmark rate that shows the level of interest rates for fixed terms (term rates) when banks lend funds to each other without collateral¹. Today's TIBOR is Japanese Yen TIBOR, which has five tenors: one week, one month, three months, six months and 12 months². For example, the three-month rate shows the prevailing rate at which a bank lends unsecured funds to another bank for three months. What Is a Benchmark Rate? covers the role and types of benchmark rates.

TIBOR differs from TONA (Tokyo Overnight Average Rate) in two ways. First, it is a term rate for unsecured lending from one bank to another, so it includes bank credit risk³. Second, its value is set before the interest period for a floating-rate payment begins³. Because the rate is fixed at the start of the period, the borrower and the lender know in advance how much interest will change hands for that period. This way of setting the rate is called fixing in advance. By contrast, with TONA compounding in arrears, the rate is not known until just before the interest payment date¹.

The administrator, and the steps from submission to publication

The JBA TIBOR Administration, a general incorporated association, calculates and publishes TIBOR. TIBOR used to be published by the Japanese Bankers Association. To make its management more neutral, the calculation and publication work moved to the JBA TIBOR Administration, which was set up in April 2014⁴.

The steps on each business day are as follows⁵.

1. The reference banks (the financial institutions that submit rates) submit rates to the administrator, based on interbank transactions and other data.
2. The administrator calculates TIBOR from the submitted rates.
3. The administrator passes the calculated values to the data vendors it has contracts with, and the vendors publish them at 1 p.m. in principle.
4. Users such as financial institutions, corporations and institutional investors receive TIBOR from the data vendors and use it in their transactions. The values also appear on the administrator's website as reference information from 4:30 p.m. in principle.

Figure description

The figure shows each business day's steps, arranged by who carries them out. The reference banks submit rates to the administrator, which calculates TIBOR from the submitted rates and passes the value to the data vendors it has contracts with. The data vendors publish it at 1 p.m. in principle, and users such as financial institutions, corporations and institutional investors use the TIBOR they receive from the data vendors in their transactions. On the administrator's website, the values appear as reference information from 4:30 p.m. in principle. From submission to use, the value passes through four parties in turn.

Reference banks are chosen through an annual public call, and there are 15 in fiscal 2026. Reference banks are required to follow the administrator's code of conduct and other rules⁵.

Calculating TIBOR from submissions

The administrator excludes the two highest and the two lowest of the submitted rates, and publishes the simple average of the rest as TIBOR. The average is rounded half up at the sixth decimal place, giving a value with five decimal places⁵.

Consider a hypothetical example in which 15 financial institutions, A to O, submit the following three-month rates.

The 11 rates used in the average add up to 11.55, and dividing by 11 gives 1.05. The three-month TIBOR for that day is 1.05000%. The average of all 15 rates would be 1.06%, which is 0.01% higher than the value after excluding the four at the ends.

How submissions are set

Each reference bank sets its submission by looking at data in a fixed order of priority. It goes down the list from the top and sets the rate at the first level where data is available. Because this resembles water falling from top to bottom, the method is called the waterfall. The order for Japanese Yen TIBOR is as follows⁶.

At level 2, the order is actual transactions on the day in the Japan offshore market and the interbank negotiable certificate of deposit (NCD) market, quotes in the Japan offshore market, and past actual transactions in both markets. The related markets at level 3 are NCD transactions (with some exceptions), large time deposit transactions, the treasury discount bill market, the GC repo market, and the OIS (Overnight Index Swap) market⁶.

The waterfall was introduced in the "JBA TIBOR reform" of July 2017. Before the reform, when there was no actual transaction data, rates were set by expert judgment that added information other than transactions. The way this judgment was made was not specifically disclosed, and there were concerns that it was not transparent enough. The reform therefore set an order of priority so that rates are set objectively⁷. According to the administrator, no submission has been set by expert judgment at level 4 since the reform⁶. Level 4 is kept for situations in which no data is available at levels 1 to 3, such as a sudden market disruption caused by a major disaster⁶.

Regulation under the Financial Instruments and Exchange Act

TIBOR is a specified financial indicator under the Financial Instruments and Exchange Act. A specified financial indicator is a financial indicator specified by the Prime Minister because a decline in its credibility could have a material impact on Japan's capital market⁸. The Prime Minister may designate the entity that calculates and publishes a specified financial indicator as a specified financial index calculation agent⁹. A designated agent must obtain the Prime Minister's authorization for its operational rules, which set out matters such as the calculation method and the code of conduct for data providers (the reference banks, in the case of TIBOR)¹⁰. TIBOR became a specified financial indicator in May 2015 and came under the regulation of the Financial Services Agency (FSA)⁴. According to the FSA's list, there were two specified financial index calculation agents as of July 8, 2024: the JBA TIBOR Administration and QUICK Benchmarks Inc.¹¹.

Every year, the administrator reviews whether it complies with the "Principles for Financial Benchmarks: Final Report" (the IOSCO Principles), published by the International Organization of Securities Commissions (IOSCO) in July 2013, and publishes the results. In its publication of March 31, 2026, it states that it complies with the IOSCO Principles¹².

Japanese Yen and Euroyen TIBOR

TIBOR used to come in two types: Japanese Yen TIBOR and Euroyen TIBOR. Euroyen TIBOR was permanently discontinued at the end of December 2024, and only Japanese Yen TIBOR is published today². The two differed as follows¹⁴.

Euroyen TIBOR was discontinued because only a small share of its submissions was set using data from the Japan offshore market, the market it was meant to reflect. At the end of July 2024, the outstanding balance of yen deposits and call transactions in the Japan offshore market was about 0.4 trillion yen. This had long been smaller than the balance in the uncollateralized call market, which Japanese Yen TIBOR reflects (about 31.7 trillion yen)¹⁵. After public consultations starting in October 2018, the administrator decided in March 2024 to discontinue publication¹⁶. The last publication for all five tenors was on December 30, 2024¹⁷.

The clearing arrangements also changed with the discontinuation. On November 25, 2024, Japan Securities Clearing Corporation (JSCC) converted the interest rate swaps referencing Euroyen TIBOR, all at once, into OIS referencing TONA. In February 2025, the FSA removed trades whose floating rate is three-month or six-month Euroyen TIBOR from the scope of the mandatory clearing obligation¹⁸. The mandatory clearing obligation requires financial instruments business operators, etc. to have a clearing organization assume the obligations under certain OTC derivatives trades¹⁹.

As for Japanese Yen TIBOR, the administrator regards it as a benchmark that will continue to be published. It states that it is not considering discontinuing publication and has no plans to do so²⁰.

How TIBOR is used in loans and interest rate swaps

Japanese Yen TIBOR is widely used in loans and derivatives. In a survey by the administrator of about 280 financial institutions, loans referencing Japanese Yen TIBOR totaled 119.8 trillion yen at the end of December 2021, and the notional amount of derivatives was 180.4 trillion yen²¹. JSCC, a central counterparty, clears yen interest rate swaps whose floating rate is one-month, three-month or six-month Japanese Yen TIBOR²².

In a trade with a floating rate based on TIBOR, the interest for each calculation period is computed from the TIBOR set before that period begins. Consider a hypothetical example in which an interest rate swap has a notional amount of 10 billion yen, a floating rate of three-month Japanese Yen TIBOR, and a 90-day calculation period. Days are counted on a 365-day basis (see day count convention)²³. If the TIBOR used for that period is 1.05%, the floating rate interest is as follows.

$$10\text{ billion yen} \times 1.05\% \times \frac{90}{365} = 25{,}890{,}411\text{ yen}$$

If TIBOR rises to 1.25% for the next period, the interest for the same 90 days becomes 30,821,918 yen. The floating rate payer pays 4,931,507 yen more, and the receiver receives the same amount more. If TIBOR instead falls to 0.85%, the interest becomes 20,958,904 yen, and both the payer's payment and the receiver's receipt fall by 4,931,507 yen.

A public consultation held in 2019 chose three candidates to replace yen LIBOR (London Interbank Offered Rate): TIBOR, TORF (Tokyo Term Risk Free Rate) and TONA compounding in arrears²⁴.

The administrator says that parties to contracts referencing Japanese Yen TIBOR should consider including a fallback clause. A fallback clause sets out in the contract, in advance, which rate will be used instead if publication ever stops. As candidates for the replacement rate, the administrator lists TONA compounding in arrears and a term risk-free rate (RFR; TORF is assumed)²⁵. How fallbacks work and how the spread is adjusted are covered in Fallbacks and Spread Adjustments.

Notes

1. Bank of Japan Financial Markets Department and Financial System and Bank Examination Department, and Financial Services Agency Strategy Development and Management Bureau and Supervision Bureau, "円LIBOR移行対応の振り返りと今後の取り組み" (Bank of Japan Review 2022-J-8, May 2022, in Japanese), page 3 (the main text and "【図表 2】代替金利指標の３つの選択肢" (Chart 2: three options for alternative interest rate benchmarks)). An English version is available: "Review of JPY LIBOR Transition and Future Initiatives" (Bank of Japan Review 2022-E-4, May 2022), page 3. ↩ ↩²

2. JBA TIBOR Administration, "金利指標改革を踏まえた全銀協TIBORの現状および今後の展望" (The current state and outlook of JBA TIBOR in light of benchmark reform, June 2026, detailed explanatory material, in Japanese), page 1 ("全銀協TIBORとは" (What is JBA TIBOR), and the table and notes under "＜日本円TIBORについて＞" (About Japanese Yen TIBOR)). ↩ ↩²

3. Study Group on Risk-Free Reference Rates, "日本円ＯＩＳ（Overnight Index Swap）─取引の概要と活用事例─" (Yen OIS: overview of transactions and examples of use, April 2018, in Japanese), page 7, "（１）IBOR とOIS レートの性質の違い" ((1) Differences in the nature of IBOR and OIS rates). ↩ ↩²

4. Bank of Japan Financial Markets Department and Financial System and Bank Examination Department, and Financial Services Agency Strategy Development and Management Bureau and Supervision Bureau, "円LIBOR移行対応の振り返りと今後の取り組み" (Bank of Japan Review 2022-J-8, May 2022, in Japanese), footnote 28 on page 8. The English version (Bank of Japan Review 2022-E-4) says the same in footnote 28. ↩ ↩²

5. JBA TIBOR Administration, "金利指標改革を踏まえた全銀協TIBORの現状および今後の展望" (The current state and outlook of JBA TIBOR in light of benchmark reform, June 2026, detailed explanatory material, in Japanese), page 2 ("全銀協TIBORの算出・公表手続き" (Calculation and publication procedure of JBA TIBOR), "リファレンス・バンクとは？" (What is a reference bank?), "TIBORの算出方法" (How TIBOR is calculated), and the notes). ↩ ↩² ↩³

6. The same document, page 7 ("ウォーターフォール構造を踏まえた算出について" (Calculation based on the waterfall structure) and note ※4). ↩ ↩² ↩³ ↩⁴

7. The same document, page 13 (FAQ ①, "全銀協TIBORのレートは、客観性が保たれていますか？" (Are JBA TIBOR rates kept objective?)). ↩

8. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese; English translation: Japanese Law Translation), Article 2, paragraph 40. ↩

9. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese; English translation: Japanese Law Translation), Article 156-85, paragraph 1. ↩

10. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese; English translation: Japanese Law Translation), Article 156-87, paragraph 1 (authorization of operational rules), and paragraph 2, item 1 (calculation method) and item 3 (code of conduct for information providers). ↩ ↩²

11. Financial Services Agency, "特定金融指標算出者一覧" (List of specified financial index calculation agents, in Japanese), as of July 8, 2024 (Reiwa 6). ↩

12. JBA TIBOR Administration, "全銀協TIBOR改革" (JBA TIBOR reform, in Japanese), "IOSCO原則の遵守状況" (Compliance with the IOSCO Principles) ("「金融指標に関する原則の最終報告書」（IOSCO原則）の遵守状況について（2026年３月31日公表）" (Compliance with the "Principles for Financial Benchmarks: Final Report" (IOSCO Principles), published March 31, 2026)), and the description of "全銀協TIBOR改革" (JBA TIBOR reform) at the top of the page. ↩

13. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese; English translation: Japanese Law Translation), Article 38, item 7. ↩ ↩²

14. JBA TIBOR Administration, "金利指標改革を踏まえた全銀協TIBORの現状および今後の展望" (The current state and outlook of JBA TIBOR in light of benchmark reform, June 2026, detailed explanatory material, in Japanese), the table under "＜日本円TIBORについて＞" (About Japanese Yen TIBOR) on page 1. The Euroyen TIBOR column is based on the table under "＜日本円TIBORとユーロ円TIBOR＞" (Japanese Yen TIBOR and Euroyen TIBOR) on page 1 of the June 2024 edition by the same administrator (the June 2026 edition does not include a Euroyen TIBOR column). ↩

15. JBA TIBOR Administration, "金利指標改革を踏まえた全銀協TIBORの現状および今後の展望" (The current state and outlook of JBA TIBOR in light of benchmark reform, June 2026, detailed explanatory material, in Japanese), page 8 (the status of measures for Principle 7, and note ※1). ↩

16. The same document, page 10 (the table "ユーロ円TIBORに係る主な実施事項" (Main actions concerning Euroyen TIBOR)). ↩

17. JBA TIBOR Administration, "全銀協TIBOR改革" (JBA TIBOR reform, in Japanese), the description under "全銀協TIBOR改革Next" (JBA TIBOR Reform Next) ("最終公表日は12月30日" (the last publication date was December 30; our translation)). ↩

18. JBA TIBOR Administration, "全銀協TIBOR改革" (JBA TIBOR reform, in Japanese), the rows for November 2024 (Japan Securities Clearing Corporation) and February 2025 (Financial Services Agency) under "国内外の動向" (Developments in Japan and overseas). ↩

19. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese; English translation: Japanese Law Translation), Article 156-62. ↩

20. JBA TIBOR Administration, "金利指標改革を踏まえた全銀協TIBORの現状および今後の展望" (The current state and outlook of JBA TIBOR in light of benchmark reform, June 2026, detailed explanatory material, in Japanese), page 15 (FAQ ③). ↩

21. The same document, page 3 (the Japanese Yen TIBOR table in "全銀協TIBORエクスポージャー調査の結果概要について" (Summary of the results of the JBA TIBOR exposure survey); total for all business categories, as of the end of December 2021). ↩

22. Japan Securities Clearing Corporation, "清算対象取引（金利スワップ）" (Transactions eligible for clearing: interest rate swaps, in Japanese), the table of eligible products and conditions 4, 5, 9, 11 and 14. An English version is available: "Clearing Products" (Interest Rate Swap). ↩ ↩²

23. Japan Securities Clearing Corporation, "清算対象取引（金利スワップ）" (Transactions eligible for clearing: interest rate swaps, in Japanese), condition 11 (the day count fraction for the floating rate is Actual/365(Fixed)). That Japanese Yen TIBOR uses a 365-day basis is shown in the table on page 1 of the JBA TIBOR Administration's detailed explanatory material (June 2026). ↩

24. Bank of Japan Financial Markets Department and Financial System and Bank Examination Department, and Financial Services Agency Strategy Development and Management Bureau and Supervision Bureau, "円LIBOR移行対応の振り返りと今後の取り組み" (Bank of Japan Review 2022-J-8, May 2022, in Japanese), page 3 (the main text and "【図表 2】"). The consultation was held by the Cross-Industry Committee on Japanese Yen Interest Rate Benchmarks, whose full name appears on page 2. ↩

25. JBA TIBOR Administration, "金利指標改革を踏まえた全銀協TIBORの現状および今後の展望" (The current state and outlook of JBA TIBOR in light of benchmark reform, June 2026, detailed explanatory material, in Japanese), page 9 ("当運営機関の見解" (The administrator's view) on fallbacks from Japanese Yen TIBOR), page 14 (FAQ ②), and page 17 ("日本円TIBOR参照契約へのフォールバック条項の導入について" (Introducing fallback clauses into contracts referencing Japanese Yen TIBOR)). ↩