Are You Ready for the Cessation of USD LIBOR?

With the cessation of USD LIBOR drawing closer, regulators have warned entities to avoid taking on new LIBOR exposure except in very limited circumstances. One-week and two-month USD LIBOR—as well as all non-USD LIBOR tenors—will cease publication immediately after December 31, 2021. Three-month, six-month, and one-year USD LIBOR will cease publication after June 30, 2023.

Companies that have not adequately prepared for the transition away from LIBOR risk potentially adverse impacts to themselves, their borrowers, investors, customers, and counterparties. 

In this article published by Treasury & Risk, Eversheds Sutherland Partner Jamie Cain and Associates Nana Amoo and Lizet Steele highlight how companies should handle the situation over the coming months and what they need to know to avoid unnecessary risks. It provides an update on the status of the regulatorily-mandated transition away from LIBOR, focusing on United States Dollar (USD) derivative products and cash products (floating rate notes, bonds, loans and securitizations) that reference USD LIBOR.