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STERN REMINDER OF THE END OF LIBOR

On October 5, 2021, Federal Reserve Board Vice Chair for Supervision Randal K. Quarles spoke at The Structured Finance Association Conference in Las Vegas on “Goodbye to All That: The End of LIBOR.” Quarles reminded his audience that while LIBOR will no longer be a functional index after June 30, 2023, it will not be available for use in any new contracts after the end of 2021 — just 85 days from today. The Federal Reserve and […]

INTERAGENCY STATEMENT – CEASE ORIGINATION OF LIBOR-BASED CONTRACTS

On November 30, 2020, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation (collectively, the agencies) issued a statement to encourage banks to cease entering into new contracts that use USD LIBOR as a reference rate as soon as practicable and in any event by December 31, 2021, in order to facilitate an orderly—and safe and sound— LIBOR transition.

INTERAGENCY STATEMENT ON LIBOR TRANSITION

On November 6, 2020, the Comptroller of the Currency, the Federal Reserve Board and the Federal Deposit Insurance Corporation (collectively, the agencies) issued a Statement on Reference Rates for Loans. The statement reiterates that the agencies are not endorsing a specific replacement rate for LIBOR for loans. A bank may use any reference rate for its loans that the bank determines to be appropriate for its funding model and customer needs. However, the bank should […]

PROPOSED REGULATION Z CHANGES FOR LIBOR TRANSITION

On June 4, 2020 the Consumer Financial Protection Bureau (CFPB) published a 219 page proposal to amend Regulation Z to facilitate creditors’ transition away from using the London Interbank Offered Rate (LIBOR) as an index for variable-rate consumer credit products. The CFPB is proposing changes to: Certain open-end and closed-end provisions to provide examples of replacement indices for LIBOR indices that meet certain Regulation Z standards. Certain open-end provisions restricting index changes, requiring change-in-terms notices, […]