Thursday, February 11, 2021
If you have a credit facility based on the London Interbank Offered Rate (LIBOR), you may soon get a notice from your lender or the administrative agent on your credit facility saying that a “Benchmark Transition Event” has occurred. Here is what you need to know about what that notice really means.
ICE Benchmark Administration Announcement
On November 30, 2020, LIBOR’s administrator, the ICE Benchmark Administration (IBA), announced that it would consult on ceasing to determine one-week and two-month USD and all GBP, EUR, CHF and JPY LIBOR settings after the December 31, 2021, setting and ceasing to determine all other USD LIBOR settings after the June 30, 2023, setting. On January 25, 2021, that consultation closed, and market participants believe that the IBA will likely issue a statement about that consultation imminently.