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LIBOR: The Future of Forward Looking Term SOFR

The syndicated loan market would really like an IOSCO-compliant Forward Looking Term SOFR to develop. If such a rate developed, it would solve several problems inherent in SOFR.

SOFR: Your Vote Counts

SOFR tools are coming! On November 4th, the FRBNY released a request for public comment on an official “SOFR Compound Average” and a “SOFR Index”. Below, we describe these tools, their use cases and several questions from the consultation. The LSTA is considering responding.

The Great Migration Away From LIBOR

LIBOR, “the world’s most important number”, is likely to cease after 2021. This presents significant—but hopefully surmountable—challenges. We discuss the LIBOR problem, timeline and potential shorter- and longer-term solutions. We know whereof we speak; the LSTA is a member of the overall Alternative References Rates Committee (“ARRC”), the body tasked with replacing U.S. dollar LIBOR.  […]

SOFR Tools: Averages and Indices

We’d be the first to acknowledge that transitioning from LIBOR to SOFR is hard. But LIBOR will end and we must prepare. Recognizing that, the September 5, 2019 Alternative Reference Rate Committee (“ARRC”) minutes introduced two tools to help ease the transition.

LIBOR Fallbacks: The Deep Dive

On April 25, 2019, the Alternative Reference Rates Committee (“ARRC”) released its recommended LIBOR fallback language for syndicated loans and floating rate notes. While the ARRC also published a very helpful narrative explaining how the legal language in the fallbacks worked, sometimes it is easier to understand complicated legal language by talking to the experts.

Leaving LIBOR: Two Steps Forward

The past week has been big. After 10 months of work, the Alternative Reference Rate Committee (“ARRC”) released its recommended LIBOR fallback language for syndicated loans and floating rate notes. The LSTA co-chairs the ARRC Business Loans Working Group, was one of the drafters of the loan fallback language, and also has published an easy-to-read explanation of LIBOR fallbacks and a printable one-pager here (after login).

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LIBOR: The Future of Forward Looking Term SOFR

The syndicated loan market would really like an IOSCO-compliant Forward Looking Term SOFR to develop. If such a rate developed, it would solve several problems inherent in SOFR.