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LIBOR transition – what you need to know

The use of LIBOR as a reference rate in loan agreements or derivatives will no longer be allowed from 2021. We outline the things all businesses need to do now to prepare for the end of LIBOR.

Timeline

IBOR transition timeline

The use of LIBOR as a reference rate in loan agreements or derivatives will no longer be allowed from 2021. We outline the things all businesses need to do now to prepare for the end of LIBOR.

Hot topics

FCA announcement on cessation of LIBOR

This statement announces the future cessation or loss of representativeness of the 35 LIBOR benchmark settings currently published by ICE Benchmark Administration (IBA), an authorised administrator, regulated and supervised by the FCA.

ISDA Statement on UK FCA LIBOR Announcement

ISDA has published the following statement in response to the announcement by the UK Financial Conduct Authority (FCA) on the future cessation and loss of representativeness of the LIBOR benchmarks.

IBOR Fallbacks Protocol

ISDA IBOR Fallbacks Protocol became effective on 25th January 2021. Find out more here.

Edwin Schooling Latter speech on LIBOR cessation

Speech by Edwin Schooling Latter, Director Markets and Wholesale Policy at the FCA, delivered at City & Financial's Managing LIBOR transition event on 26 January 2021.

Helpsheets

10 questions NEDs should be asking about LIBOR transition

ICAEW’s Financial Services Faculty highlight 10 questions non-executive directors can ask to build a robust conversation around how their business is responding to the change. Therefore, the imminent change to LIBOR and its replacement with overnight rates will be far-reaching.

FSF Benchmark reform 2nd help sheet July 2019

Benchmark reform update: Our first Benchmark Reform Helpsheet (published 10 August 2018) outlined proposed changes to LIBOR and the need to transition to alternative risk free rates (RFR). Since then, awareness of Libor Transition has increased and work has been done to mitigate known risks through the development of fallback language and alternate RFR products. This second Helpsheet sets out some of the market progress, key considerations, risks and the next steps.

Benchmark reform

Alternative reference rates and transition from LIBOR.

Articles

Staying afloat during IBOR reform

Mark Spencer, Financial Services’ Accounting Advisory team lead at BDO, sets sail on the amendments issued by the International Accounting Standards Board (IASB) and Financial Reporting Council (FRC).

LIBOR transition five things all businesses need to do now

LIBOR will no longer be allowed as a reference rate in loan agreements or derivatives from 2021 and its use is rapidly diminishing. Over the next year banks must contact businesses with loans that charge interest based on LIBOR to agree what their new rate will be

Coming off the bench

Benchmark reform by global regulators will impact upon financial reporting in the next two years

Related blog posts

Transitioning from LIBOR

The end of LIBOR will mean some big changes for businesses. The end date of December 2021 may seem a long way off, but companies need to start preparing now.

What is next after LIBOR?

In July 2017, the FCA confirmed that it will no longer ask banks to voluntarily submit data to the LIBOR after 2021. This has been perceived by some as an indication of the timeline for replacing the LIBOR benchmark. Find out what this means for you.

Webinars

Regulatory-Convened Working Group

SOFR Transition

This information relates to the SOFR (Secured Overnight Financing Rate) and LIBOR Transition.

Transition to Sterling free rates from LIBOR

This information is from the Bank of England Working Group on Sterling Risk-Free Reference Rates (RFRWG). It was established in 2015 to implement the Financial Stability Board's recommendation to develop alternative risk-free rates (RFRs) for use instead of Libor-style reference rates.

The National Working Group on Swiss Franc reference rates

This information is from the Swiss National Working Group (NWG) which is the key forum to foster the transition to SARON and to discuss the latest international developments. The NWG is co-chaired by a representative of the private sector and a representative of the Swiss National Bank (SNB).