Introduction
On 5 March 2021, the UK s Financial Conduct Authority (FCA) formally announced the dates for the cessation of all London Interbank Offered Rate (LIBOR) benchmark settings currently published by ICE Benchmark Administration (IBA). The FCA also confirmed that where a synthetic LIBOR is available after the cessation dates, the synthetic LIBOR will not in any event be considered to be representative as of the cessation dates. This is an important step towards the end of LIBOR, providing market participants with a fixed timeline for LIBOR s cessation. The announcement also adds pressure on market participants to complete their transition plans by the end of 2021.
I. What’s the issue?
The London Interbank Offered Rate (“LIBOR”) is the most widely used interest rate benchmark in the world, referenced in some $373 trillion notional value of financial transactions of all types. But in light of the various price-fixing scandals surrounding LIBOR and the limited activity in the London interbank market, the U.K. Financial Conduct Authority (“FCA”) announced in 2017 that it will no longer sustain the publication of LIBOR as a reference rate by the end of 2021. LIBOR’s administrator now plans to retire 3-, 6-, and 12-month U.S. dollar LIBOR in late June 2023, while leaving in place the end-of-2021 retirement date for 1-week and 2-month U.S. dollar LIBOR and for all LIBOR settings in British pounds, euros, Swiss francs, and yen. U.S. regulators have encouraged banks to transition away from LIBOR “as soon as practicable.”
Risk.net
Corporates remain on swaps fallback sidelines
Risk.net analysis finds just 14 out of 100 large non-financial firms have signed up to Isda fallback protocol Print this page
Non-financial corporates have been slow to sign up to a Libor fallback protocol devised by the International Swaps and Derivatives Association, with just 14 out of 100 of the largest listed companies adopting the standard language to future-proof swaps contracts, according to research by
Risk.net.
The analysis was conducted across the top 25 non-financial constituents by market capitalisation in four major stock market indexes. The data show six of the largest 25 corporates in both the S&P 500
UAE: Analysing potential alternatives to Libor iflr.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from iflr.com Daily Mail and Mail on Sunday newspapers.
Recent UK and EU regulatory developments of interest to financial institutions and markets.
Contents:
UK Money Markets Code updated by BoE
UK Listing Review: government response
UK EMIR: trade association letter on use of EEA UCITS as collateral
MiFID: European Commission adopts Delegated Regulation correcting MiFID Delegated Regulation (EU) 2017/565
EMIR and SFTR: ESMA reports on quality of data published
LIBOR transition: FMSB case studies for conduct risk in back book transition
Recognised Auction Platforms (Amendment and Miscellaneous Provisions) Regulations 2021
The Recognised Auction Platforms (Amendment and Miscellaneous Provisions) Regulations 2021 (SI 2021/494) have been published, together with an explanatory memorandum.
The Regulations, made under section 8 of the European Union (Withdrawal) Act 2018, amend primary and secondary legislation, and parts of retained EU law, to address deficiencies arising from the withdrawal of the UK from the EU. They amend UK fina