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Clifford Chance

IBORs and benchmark reform

Exploring the impact of transitioning from LIBOR and other IBORS

The transition from LIBOR and other IBORs could be the most significant change to financial markets in recent years.

Participants in the derivatives market have been planning for the introduction of alternative risk free rates for some time, and the bond and loan markets are in a period of consultation to prepare for the transition.

Our experts can help market participants to understand what this will mean for their transactions and prepare for the future.

Rate Expectations: Transitioning away from LIBOR - practical guidance for corporate treasurers

It has been over 18 months since Andrew Bailey, Chief Executive of the UK’s Financial Conduct Authority (FCA), announced the need for the market to transition away from LIBOR before the end of 2021. As we get ever closer to that December 2021 end date, this briefing explores the current state of LIBOR transition, what a move to risk-free rates will mean in practice for corporate treasurers, and some key steps that treasurers might take in the near term to ready themselves for LIBOR’s potential demise. Read more

OIS and RFR Futures Conventions: Lessons for LIBOR replacement term rates

The development of term benchmarks based on risk-free rates (RFRs) is an important aspect of the work to facilitate a successful transition from LIBOR, particularly for corporate lending and other cash products. This briefing considers how conventions used in Overnight Index Swaps (OIS) and RFR futures markets are relevant to the development of RFR-based term rates. Read more

LIBOR - a brief history

From the outset of its creation, the syndicated loan market worked on the principle that pricing would be based on the interest rate at which interbank deposits were offered by banks to other prime banks. LIBOR will cease to be publised by the end of 2021 at the latest. How did we get to this point and what are the alternatives? Read more

Transitioning from LIBORs and IBORs - an international overview

Before financial markets can be encouraged to move from using LIBOR or other IBORs as reference rates in new financial contracts, there must be suitable alternatives in place. This briefing provides a snapshot of “risk-free reference rates” (RFRs) selected by different markets to replace LIBORs and IBORs for different currencies. Read more

LIBOR - Cross Product Review

The market is looking for an appropriate replacement for LIBOR that this works across all transactions. This briefing reviews the comparative product challenges for the loan, bond (including securitisation) and derivatives markets. Read more

IBOR fallbacks for derivatives

ISDA released its "Consultation on Certain Aspects of Fallbacks for Derivatives Referencing GBP LIBOR CHF LIBOR, JPY LIBOR, TIBOR, Euroyen TIBOR and BBSW" on 12 July 2018. The Consultation is open to all market participants and responses may be submitted until 12 October 2018. Read more

LIBOR and operating leases

The reform of LIBOR and other global benchmark rates used in loans and other financial instruments continues. This briefing considers the impact of the potential discontinuation and replacement of LIBOR on aircraft operating leases and suggests next steps for lessors and lenders. Read more

US consideration for transition away from LIBOR

This briefing assesses the move away from LIBOR and the implications for the US market. Read more

LIBOR - the beginning of the end?

Although a bedrock of the financial markets for over 30 years, LIBOR has been under pressure ever since the Wheatley Review, and a speech given by Andrew Bailey, Chief Executive of the UK's Financial Conduct Authority on July 27th heralds its potential demise. Read more