Many IBOR remediation projects raise a basic question: How do you find, collect, review, and remediate the right contracts? A company might have thousands of contracts that need to be repapered, and those contracts might be scattered throughout electronic file systems and hardcopy records. Fortunately, litigators have spent the past few decades wrestling with very similar questions, which crop up in the discovery process in any large-scale modern litigation. As the number of discoverable electronic…

As preparation for the transition from the London Interbank Offered Rate and similar interbank offered rates to replacement benchmark interest rates quickly accelerates, we explore a number of recent core global developments affecting structured finance products. Read the full article from the Winter 2020 issue of our Structured Finance Bulletin.…

On November 30, 2020, ICE Benchmark Administration (“IBA”), the administrator of U.S. Dollar LIBOR (“USD LIBOR”) and other IBORs, lowered the pressure with respect to the upcoming cessation of USD LIBOR. IBA announced that, following a consultation in December and January, (i) it intends to cease publication of 1-week and 2-month USD LIBOR at the end of 2021 and (ii) subject to compliance with applicable regulations, including as to representativeness, it does not intend to…

In response to the UK Financial Conduct Authority’s proposed discontinuation of LIBOR, Japan, like other countries that rely on LIBOR as the preferred reference rate, has had to consider alternatives for its reference rate that uses USD LIBOR as a component. In 2019, the Cross Industry Committee on Japanese Yen Interest Rate Benchmarks, together with the Bank of Japan, held a public consultation on the choice of alternative benchmarks to JPY LIBOR, the results of…

Hong Kong Monetary Authority (“HKMA”) is the front-line regulator for licensed banks and deposit-taking companies (“AIs” or “authorised institutions”) in Hong Kong. LIBOR is used extensively in the Hong Kong banking sector. According to survey results released by HKMA in July 2020, LIBOR-linked products represented 30% and 11% respectively of the banking system’s total assets and total liabilities denominated in foreign currencies as of March 2020. In addition, there were about HK$35 trillion worth of…

On 23 November 2020, the LMA published various documents with the aim of assisting market participants looking to include active LIBOR transition mechanisms in their loan documentation. These documents are a mix of new and revised versions of existing drafts, comprising: a revised version of the exposure draft multicurrency term and revolving facilities agreement incorporating rate switch provisions (lookback without observation shift);[1] a new exposure draft multicurrency term and revolving facilities agreement incorporating rate…

On November 30, 2020, ICE Benchmark Administration Limited (“IBA”) announced its intention, in early December 2020, to consult on the proposed cessation of the publication of: the one-week and two-month USD LIBOR settings immediately following the LIBOR publication on December 31, 2021; and the overnight and one-, three-, six- and 12-month USD LIBOR settings immediately following the LIBOR publication on June 30, 2023. IBA expects to close the consultation for feedback by the end of…