The SC-STS has updated the SORA Market Compendium. With the deadlines for the cessation of use of SOR for new loans, securities and derivatives having passed, this update provides market participants with a snapshot and market insights on the SOR to SORA Transition to date as well as current and expected volumes, liquidity and trends. … Continue Reading
On 29 July 2021, the ARRC has formally recommended the CME Group’s forward-looking Secured Overnight Financing Rate (SOFR) term rates (Term SOFR). It follows the completion of interdealer trading conventions to SOFR earlier this week. This means that parties which have contracts which include the ARRC hardwired fallbacks will fallback to Term SOFR given that … Continue Reading
The SC-STS published its Recommendations for Transition of Legacy SOR Contracts on 29 July 2021, with updated timelines and key recommendations for the industry-wide transition from SOR to SORA. Market participants are urged to take active steps to substantially transition out of legacy SOR exposures by 31 December 2021, using the SOR-SORA basis swap market … Continue Reading
The Monetary Authority of Singapore (MAS) issued a consultation paper on 2 July 2021 seeking views on various proposals, including to introduce powers to enable the MAS to impose requirements on certain financial institutions conducting unregulated business. The MAS recognises that some of its regulated entities may be carrying on unregulated activities (e.g. trading bitcoin … Continue Reading
The SC-STS have issued the Timelines to Cease Issuance of SOR Derivatives and SIBOR-Linked Financial Products and recommended the end-September 2021 as the timeline for all banks to cease issue of SOR derivatives and SIBOR-linked cash products. The SC-STS also took the opportunity to issue guidance on dealing with the limited cases of SOR loans … Continue Reading
Today, the FCA has confirmed that all LIBOR settings will either cease to be provided by any administrator or no longer be representative: immediately after 31 December 2021, in the case of all sterling, euro, Swiss franc and Japanese yen settings, and the 1-week and 2-month US dollar settings; and immediately after 30 June 2023, in the … Continue Reading
On 2 February 2021, the Singapore Steering Committee for SOR & SIBOR Transition to SORA (SC-STS) set out key steps to further advance the industry transition to a SORA-centered SGD interest rate market by end-2021. It also published an updated SC-STS Transition Roadmap 2021/22 with priorities for 2021/2022. The SC-STS noted that whilst the recent ICE Benchmark Administration … Continue Reading
This blog series has been named after the classic children’s categorisation game where one player names an object and the other player has to categorise it as an animal, vegetable or mineral. Whilst simple in concept, the difficulty of the game varies – some things are extremely easy to categorise (such as ‘cat’), whereas others … Continue Reading
This blog series has been named after the classic children’s categorisation game where one player names an object and the other player has to categorise it as an animal, vegetable or mineral. Whilst simple in concept, the difficulty of the game varies – some things are extremely easy to categorise (such as ‘cat’), whereas others … Continue Reading
Singapore’s key financial industry committees, the Association of Banks in Singapore (ABS), the Singapore Foreign Exchange Market Committee (SFEMC) and the Steering Committee for SOR & SIBOR Transition to SORA (SC-STS) (together, the Committees) have released their responses to the feedback received on the report “SIBOR Reform and the Future Landscape for SGD Interest Rate … Continue Reading
Yesterday, the ICE Benchmark Administration (IBA) which compiles and oversees LIBOR, announced its impending consultation on what it is effectively a proposed extension of most (and the more widely used) US dollar (USD) LIBOR tenors until 30 June 2023. This is hugely significant for the markets in Asia where USD is by far the most … Continue Reading
The Asia Pacific Loan Market Association (APLMA) has issued SOFR-based Discussion Documents and Guidance Note on 12 November 2020. This is a significant milestone in promoting discussions and accelerating the transition process in Asia. There is no settled market approach or convention as yet given the nascent stage of development of the RFR loan markets. … Continue Reading
The Association of Banks in Singapore (ABS), the Singapore Foreign Exchange Market Committee (SFEMC), and the Steering Committee for SOR Transition to SORA (SC-STS) have issued a consultation report, SIBOR Reform and the Future Landscape of SGD Interest Rate Benchmarks (Report). The Report recommends the discontinuation of the SGD Singapore Interbank Offered Rate (SIBOR) in … Continue Reading
Last September, the LMA published Exposure Drafts of Compounded RFR Facilities Agreements by reference to SOFR and SONIA (being the chosen replacement near risk free rates for USD markets and LIBOR in the Sterling respectively), along with a commentary inviting market participants to consider various structuring issues (see earlier blog). The APLMA recently sought feedback from … Continue Reading
The Monetary Authority of Singapore (MAS) recently issued a consultation paper setting out its proposed regulatory approach for derivatives contracts that reference payment tokens as underlying assets (Payment Token Derivatives). What is this approach meant to address? A well-regulated market for derivatives – particularly one anchored by institutional investors with sophisticated risk management and investment … Continue Reading
Norton Rose Fulbright has been engaging globally with clients to assist them to update their existing derivatives documentation to ensure regulatory compliance with the varying local implementation of the BCBS-IOSCO final report on “Margin requirements for non-centrally cleared derivatives”. Final rules on margining have been in place for a while in a number of jurisdictions requiring … Continue Reading
