No one should be surprised that LIBOR may be going away – and everyone should be making preparations because LIBOR cessation could disrupt $200 trillion of U.S. dollar LIBOR contracts, including $4 trillion of syndicated loans and $500 billion of CLOs.
So what should you do? Step One – ensure that your loan fallback language is robust. On September 24, 2018, the Alternative Reference Rates Committee (ARRC) released a syndicated loans LIBOR fallback consultation to address this very issue. The ARRC is seeking feedback from individual institutions to understand challenges and benefits of each approach from that institution’s perspective.
In this webcast, the LSTA, co-chair of the ARRC Business Loans and CLOs Working Group, reviewed:
- The objectives of the consultation
- The critical components of LIBOR fallback language
- The two loan fallback proposals (the “amendment” approach and the “hardwired” approach)
- The specific questions in the consultation (and what they are trying to achieve)
The Consultation will be open through November 8, 2018 and the ARRC intends to publish recommended fallback language on syndicated loans around year-end. Make your voice heard!
Thursday, October 4, 2018
11AM to 12PM (ET) | Webcast Only
- Meredith Coffey, LSTA EVP – Research and Regulation
- Tess Virmani, LSTA SVP & Associate General Counsel