800-248-3229 solutions@bbky.com

Managing the LIBOR Transition

The FDIC, OCC, The Federal Reserve Bank, and other agencies released a joint statement that emphasizes the expectation for lenders “to progress toward an orderly transition away from LIBOR”.

The statement also clarifies previous guidance that lenders should not enter into “new contracts” using LIBOR as a reference rate as it creates safety and soundness risk” and that lenders should conduct “the due diligence necessary to ensure that alternative rate selections are appropriate for the supervised institution”.

In a previous separate statement, the OCC, FDIC, and The Federal Reserve Bank issued a joint statement that “encouraged supervised institutions to cease entering into new contracts that use LIBOR as a reference rate as soon as practicable, but no later than December 31, 2021.”

A copy of the statement is available here.

Subscribe to our News Blog