On 27 July 2017, Andrew Bailey, Chief Executive of the UK Financial Conduct Authority, made a speech about the future of LIBOR stating that market participants should not rely on LIBOR being available after 2021. 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.
On 15 September 2020, we published an updated version of the list which sets out the near risk-free rate (RFR) referencing loans which have been announced to date. The list is based on publicly available information and seeks to raise awareness of RFR referencing loans by providing information on the conventions used and also links to public information. Please note this list is not a fully comprehensive list of all market transactions referencing RFRs.
On 11 September 2020, we published an exposure draft multicurrency term and revolving facilities agreement incorporating rate switch provisions. This exposure draft is based on lookback without observation shift. The Rate Switch Agreement has been published as an exposure draft and does not constitute a recommended form of the LMA. We would request market participants to send us feedback on the Rate Switch Agreement by close of business on 25 September 2020.
Working Group on Sterling Risk-Free Reference Rates statement on conventions for referencing SONIA compounded in arrears in the sterling loan market
On 2 September 2020, the Working Group on Sterling Risk-Free Reference Rates released a statement of recommendations for conventions for sterling loans based on SONIA compounded in arrears. The recommendations are intended to support the Working Group’s target for lenders to be able to offer non-LIBOR alternatives to customers by the end of September 2020.
Click here to access Bloomberg's IBOR Fallback Rates (Delayed Data)