December 4, 2023 - On November 30, 2023, the Alternative Reference Rates Committee (ARRC) released its final reflections on LIBOR transition and announced the conclusion of the group itself. An accompanying report discussed the background and process of LIBOR cessation and offered three areas for firms to continuously prioritize:

  1. Active review of any reference rates that firms may consider using;
  2. Appropriate fallback language for any contractual use of reference rates; and,
  3. Maintaining an appropriate balance between use of (daily) SOFR and Term SOFR.

On point 3, it is important to note that business loans (including BSL and Private Credit loans) and securitizations of those business loans (e.g., CLOs) are specifically included in the ARRC’s guidance for use of Term SOFR.

The LSTA’s Tess Virmani and Meredith Coffey were on the ARRC itself, the LSTA co-chaired the ARRC’s Business Loans Working Group, and Ellen Hefferan was critical in the operational aspects of LIBOR transition. The LSTA would like to thank the hundreds of members that worked with us on LIBOR transition – and we all look forward to never doing this again!

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