Alternative Reference Rates Committee (“ARRC”) released its recommended LIBOR fallback language for U.S. dollar business loans and FRNs. The LSTA, as co-chair of the ARRC Business Loans Working Group, shepherded the process along with Cadwalader and the ABA....
ARRC released a white paper to help explain how market participants can use its recommended alternative to U.S. dollar LIBOR, the Secured Overnight Financing Rate (SOFR), in cash products. This paper builds on the ARRC's work developing the Paced Transition Plan, which outlines the steps for an effective shift to SOFR....
1 ALTERNATIVE REFERENCE RATES COMMITTEE GUIDING PRINCIPLES ARRC Guiding Principles for More Robust LIBOR Fallback Contract Language in Cash Products The goal of the ARRC is to publish one or more sets of suggested fallback language and it has developed these principles to guide the development of U.S. dollar LIBOR fallback language within its working...
March 27, 2018 LSTA Members: Last July, Andrew Bailey, Chief Executive of the UK based Financial Conduct Authority, made a now famous speech where he signaled the potential cessation of LIBOR as early as the end of 2021. While it is not completely clear at this time that the continued quoting of LIBOR as a...
“End-of-LIBOR” Debate March 22, 2018 - LIBOR – and the LIBOR-OIS spread – has been rising rapidly in recent months. What does this mean for the loan market – and for the “End-of-LIBOR” debate? Three-month LIBOR hit 2.27% on Wednesday, up from 1.7% at year-end. On the plus side, this should be good for loan...
LIBOR Banks Are Here to Stay… For Now November 28, 2017 - As reported by Bloomberg, the Financial Conduct Authority (FCA) took a step that should help alleviate concerns about the medium term viability of the London interbank rate (LIBOR). The U.K. financial services regulator last Friday confirmed that all 20 banks that participate in...
On LIBOR: LSTA Comment Letter October 31, 2017 (article updated on November 2, 2017) - On October 30, 2017, the LSTA, along with a number of other trade associations, submitted a comment letter in response to the Federal Reserve’s “Request for Information Relating to the Production of Rates”. Behind that unprepossessing title is one of...
LIBOR: Why You Should Care…And Shouldn’t Panic August 17, 2017 - Since the LIBOR speech by Andrew Bailey, Chief Executive of the FCA on July 27th, markets have been buzzing about whether LIBOR is ending, when it might end, and what loans and CLOs would do. On August 17th, the LSTA hosted a webcast walking...
LIBOR (Transition) in the Loan Market August 3, 2017 - As conversations around LIBOR alternatives continue, the FT reported on Wednesday that “the death of Libor may be exaggerated, particularly in US markets” despite the market buzz following last week’s speech by the Chief Executive of the U.K.’s Financial Conduct Authority (FCA). The FCA has...
