The transition from LIBOR to alternative risk free rates (RFRs) represents one of the biggest changes to the financial services industry, including those providing trust and agency services. There is increasing pressure on market participants from global regulators to take action to address LIBOR transition in both new and legacy transactions. Given the volume of product and processes affected, LIBOR transition will entail considerable work and risk.
As a result of regulator pressure, LIBOR and other benchmark rates are likely to be restructured or abolished by the end of 2021. We want to keep you up to date with key regulatory and industry developments and provide practical tools to help you navigate the challenges the reforms present.
This briefing considers the issues arising from LIBOR transition for administrative agents, collateral agents, trustees, intermediaries and other financial institutions to help you find a solution.
The team tracks financial services regulatory developments. A sample of IBOR updates over the past month includes:
- CFPB addresses elimination of LIBOR in consumer credit transactions
- ARRC 2020 Best Practices for Completing the Transition from LIBOR
- ARRC’s further consultation on spread adjustment methodologies and advice on the SOFR Index
- Supporting Risk-Free Rate transition through the provision of compounded SONIA
- FMSB publishes a Spotlight Review on navigating conduct risks in LIBOR transition
- RFRWG paper on the identification of tough legacy issues
- The Prudential Regulation Authority publish statement on prioritization in light of COVID-19
Financial Reporting Council call for evidence regarding UK’s endorsement of the recently issued Sustainability Standards
The Financial Reporting Council (FRC) has issued a call for evidence (the Call for Evidence) to collect views regarding the proposed endorsement by the UK government in respect of the first two IFRS Sustainability Disclosure Standards issued by the International Sustainability Standards Board (ISSB) in June 2023.