Podcast: CFTC Issues LIBOR Transition Relief for Swaps
The Background: In 2021, the Financial Conduct Authority ("FCA") and HM Treasury began consulting on the Wholesale Markets Review (the "Review"), a broad review of the structure, functioning, and regulation of secondary...more
On June 29, 2023, the IRS published final regulations that provide the appropriate reference rate to be used by a foreign bank that elects to use a published rate to determine the amount of excess interest expense allocable...more
A new rule removes the requirement to clear IBOR-based swaps and extends mandatory clearing to swaps on IBOR alternatives. On August 12, 2022, the US Commodity Futures Trading Commission (CFTC) voted to amend its...more
The following 10 practice points are intended to help you in assisting an issuer with a proposed debt tender offer for cash. Often, issuers of debt securities seek to manage their outstanding obligations through liability...more
On March 15, 2022, the Consolidated Appropriations Act, 2022 – which included the Adjustable Interest Rate (LIBOR) Act – was signed into law. The LIBOR Act is meant to address concerns with ceasing the use of LIBOR by...more
On Jan. 4, 2022, the Department of the Treasury (Treasury) and the Internal Revenue Service (the Service) published final regulations (the Final Regulations) offering guidance to taxpayers with respect to the widely reported...more
The IRS has issued final regulations governing the tax consequences of transitions from Interbank Offered Rates (IBORs) to other reference rates in debt instruments. The final regulations adopt many of the proposed...more
Transition rules allow opportunity to avoid taxable income when modifying financial contracts from IBOR to another metric Contracts dependent on a discontinued interbank offered rate (“IBOR”) will need to transition to an...more
The lengthy saga of the transition to a post-LIBOR world reached a degree of finality on the tax side with the issuance by the Department of Treasury and Internal Revenue Service (IRS) of long-awaited final regulations (the...more
As the IBOR transition continues, business teams have frequently heard from their tax departments and advisors that amending existing contracts to add IBOR replacement mechanics or replacing an IBOR rate with a new rate can...more
The Internal Revenue Service and the US Treasury Department have issued final regulations providing rules for taxpayers transitioning from interbank offered rates to qualified rates. These regulations provide financial...more
On December 30, 2021, the Treasury Department and IRS issued final regulations to address the taxability of modifications that replace LIBOR or another interbank offered rate (an IBOR) with a qualified rate like SOFR....more
It is starting to feel as if we are nearing the end of a long climb, in fact the end of a long period of uncertainty, for financial institutions and businesses alike, on how to deal with LIBOR transition. Having to keep an...more
Global LIBOR transition efforts continue apace. However, switching hedged loans to risk free rates is a particularly challenging area. We discuss what borrowers, lenders and hedge providers really need to focus on in order...more
In This Issue. The federal bank regulators published frequently asked questions concerning the London Interbank Offered Rate transition; the Consumer Financial Protection Bureau (CFPB) confirmed an effective date for two...more
The Internal Revenue Service (IRS) released Revenue Procedure 2020-44 to assist the market's transition from the London Interbank Offered Rate (Libor) and other interbank offered rates (IBORs) to alternative reference rates...more
This edition of the Update covers: Key Legal and Regulatory Developments Financial Markets The Australian Regulators Reiterate Their Expectations for a Smooth Transition Away From LIBOR On 4 June 2021, ASIC, APRA, and the RBA...more
On June 4, 2021, the Loan Market Association (LMA) published a recommended form of its reference rate selection agreement (the Selection Agreement), which has been updated following market feedback. The Selection Agreement...more
Global venture-backed fintech funding reached almost $23 billion in the first quarter of 2021, a 110% quarter-over-quarter increase, according to CB Insights’ latest report and webinar, The State of Fintech. Accounting for...more
On May 6, the LSTA published its long-awaited concept Daily SOFR and risk-free rate (RFR)-based multicurrency credit agreements (the Concept RFR Documents). The publication of these documents is a welcomed step in the...more
PRA supervision of annuity providers: BoE speech - The Bank of England (BoE) has published a speech (and accompanying appendix), given by Charlotte Gerken, Prudential Regulation Authority (PRA) Executive Director, Insurance...more
LIBOR transition and fallbacks in uncleared derivatives: Sterling Working Group statement and paper - Recent UK and EU regulatory developments of interest to financial institutions and markets. Also check our Financial...more
Depositor protection identity verification: PRA PS4/21 - Following its consultation in CP3/21, the UK Prudential Regulation Authority (PRA) has published a policy statement, PS4/21, on depositor protection identity...more
Following the ARRC-recommended deadline for shifting to hardwired fallbacks, the syndicated loan market has begun to show signs of change - Based on best practices published by the Alternative Reference Rates Committee...more
While a welcome development for parties to derivatives transactions generally, the launch of ISDA’s robust benchmark fallbacks may not be the most appropriate solution for IBOR cessation in finance-linked hedging transactions...more