FCA announces further plans to wind down LIBOR by December 2021

Released 29 September 2021

The Financial Conduct Authority (FCA) has confirmed that the sterling, Japanese yen, Swiss franc and euro LIBOR panels are ceasing on 31 December 2021 as arrangements are made to phase out LIBOR.

In order to avoid disruption to legacy contracts that reference the 1-month, 3-month and 6-month sterling and Japanese yen LIBOR settings, the FCA will require the LIBOR benchmark administrator to publish these settings under a 'synthetic' methodology, based on term risk-free rates, for the duration of 2022.

These six LIBOR settings will be available only for use in some legacy contracts and are not for use in new business.

Additionally, the FCA has published a consultation paper on the proposed decision on which legacy contracts can use these synthetic LIBOR rates. Comments are requested by 20 October 2021.

More information can be found at: https://www.fca.org.uk/news/press-releases/further-arrangements-orderly-wind-down-libor-end-2021

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