Rebecca Oliver (UK)

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FCA consults market on synthetic LIBOR rates

The FCA opened a consultation on 30 June seeking views on winding down the 1, 3 and 6-month synthetic sterling LIBOR settings and requesting information on market participants’ exposure to US dollar LIBOR. Since 31 December 2021, publication of 24 LIBOR settings ended, leaving only five US dollar LIBOR settings continue to be calculated using … Continue Reading

Working Group on Sterling Risk-Free Reference Rates issues recommendations on conventions to support the use of SONIA in loan markets for Sterling Bilateral and Syndicated Facilities (September 2020)

The recommendations reiterate that market participants should be ready to offer non-LIBOR loans’ products by end Q3 2020. SONIA compounded in arrears remains the Working Group’s recommended alternative to Sterling LIBOR and the intent of the recommendations is to enable and expedite the transition away from the use of LIBOR based products for the loan … Continue Reading

LMA invites market participants to comment on outstanding requirements to be satisfied before recommended forms of compounded risk free rate facilities agreements can be finalised

In September 2019, the Loan Market Association published exposure drafts of Compounded Risk Free Rate Facility Agreements by reference to SONIA and SOFR, being the chosen replacement near risk free rates for LIBOR in the Sterling and USD markets respectively together with commentary inviting market participants to consider various structuring issues which need to be … Continue Reading

Working Group on Sterling Risk-Free Reference Rates market consultation published on credit adjustment spread methodologies

The Working Group on Sterling Risk-Free Reference Rates has published a market consultation on credit adjustment spread methodologies for fallbacks in cash products referencing GBP LIBOR to assist cash markets, including the syndicated lending market, consider methodologies for credit adjustment spreads for fallbacks from LIBOR to a SONIA-derived rate that operate from a trigger date … Continue Reading

LIBOR transition to Alternative Risk Free Rates: drafting new loan agreements, and amending legacy LIBOR loan agreements

The Loan Market Association has over the last few weeks published exposure drafts of forms of loan agreement referencing risk free rates for new transactions, and a form of agreement with lenders as a first step to agreeing to amend legacy LIBOR loan agreements for alternative reference rates. On the 25th October 2019 the LMA … Continue Reading

Contractual recognition of bail-in powers by EU-regulated financial institutions from January 2016

From 1 January 2016, EU financial institutions* established in the EU will be required under article 55 of the EU Banking Recovery and Resolution Directive (2014/59/EU) (BRRD), to include contractual terms in any agreements governed by the laws of non-EU Member States, which create certain payment liabilities specifying that those liabilities may be subject to … Continue Reading