The wholesale money market in London that banks use to fund certain loans to their borrowers. Banks in need of liquidity obtain deposits from other banks with excess liquidity and pay interest on these deposits based on their terms (for example, overnight or one, three, six, nine, and 12 months). This interest rate was the basis for pricing Eurodollar rate loans.

For more information on this market and Eurodollar rate loans generally, see Practice Note, What's Market: LIBOR Interest Rate Provisions.