On 5 March 2021, the UK Financial Conduct Authority confirmed the future cessation and loss of representativeness of: (i) all 7 euro LIBOR settings, all 7 Swiss franc LIBOR settings, the Spot Next, 1-week, 2-month and 12-month Japanese yen LIBOR settings, the overnight, 1-week, 2-month and 12-month sterling LIBOR settings and the 1-week and 2-month US dollar LIBOR settings immediately after 31 December 2021; and (ii) the overnight and 12-month US dollar LIBOR settings by 30 June 2023. Work is progressing on the transition to alternative near risk-free reference rates in each of the LIBOR currencies. The LMA is working with the market, other trade associations and the regulators on the transition.
LIBOR Transition - counting down to end-2021
On 18 June 2021, we published an updated version of the list setting out RFR-referencing loans publicly disclosed to date. The update reflects bilateral and club RFR transactions for: Grain service limited liability company, JLEN Environmental Assets and GCP Infrastructure Investments Ltd. In particular, this month notes the first SOFR-linked commercial loan in Russia. The list is not comprehensive of all loan market transactions referencing RFRs given the private nature of the loan market. Sharing of experiences is key to the transition.
Please contact Kam
Mahil to submit a transaction to the list.
On 16 June 2021, we made available a written interview between Kam Mahil, Senior Director – Legal at the LMA and Markus Bieri, Corporate Finance & Treasury at Holcim Ltd, where Markus gives his views on the approach of borrowers in the Swiss market to the transition.
The transition from LIBOR
to risk-free rates affects everyone in the syndicated loan market. With LIBOR
transition deadlines fast approaching, borrowers need to be prepared for the
end of LIBOR.
LMA publishes Exposure Draft of Standard Terms and Conditions for secondary debt trading together with accompanying documentation to assist the secondary loan market with LIBOR transition
On 6 June 2021, we published an Exposure Draft of Standard Terms and Conditions for secondary debt trading (the 'Exposure Draft') together with an accompanying Explanatory Note and updated Trade Confirmation (Bank Debt). The Exposure Draft, Explanatory Note and updated Trade Confirmation have been produced after engagement and feedback from market participants to facilitate secondary loan market trading as the syndicated loan market transitions away from the use of LIBOR to compounded risk-free rates, in line with the LMA's core aim of improving liquidity in secondary syndicated loan markets.