Shearman & Sterling LLP | FinReg | <p ><span >LIBOR Panel Bank Submission Cessation Dates Confirmed<o ></o ></span ></p >
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  • LIBOR Panel Bank Submission Cessation Dates Confirmed

    The U.K. Financial Conduct Authority has announced the dates for future cessation and unrepresentativeness for all LIBOR settings.  The FCA's statement follows its confirmation in November 2017 that the 20 panel banks for the LIBOR benchmark had agreed to support LIBOR until at least the end of 2021 and the regulator's position that the future of LIBOR could not be guaranteed because the underlying markets (the markets for unsecured wholesale term lending to banks) are no longer sufficiently active. The FCA's statement confirms that all LIBOR setting will either cease to be provided by any administrator or no longer be representative:
    (i) immediately after December 31, 2021 for all sterling, euro, Swiss franc and Japanese yen settings, and the one-week and two-month U.S. dollar LIBOR settings; and

    (ii) immediately after June 30, 2023, for the remaining U.S. dollar settings (i.e. the overnight, 1, 3, 6 and 12-month U.S. dollar LIBOR settings).

    After consulting on its intentions, ICE Benchmark Administration has notified the FCA that it intends to cease providing all LIBOR settings for all currencies, unless the FCA compels it to continue publication. The FCA has confirmed that it will not compel banks to submit rates for the determination of LIBOR beyond the above dates.

    The FCA is expected to consult on whether it should use its proposed powers to require IBA to continue to publish on a synthetic basis: (i)  the one-month, three-month and six-month sterling LIBOR settings beyond December 31, 2021; and (ii) one-month, three-month and six-month Japanese yen LIBOR settings until the end of December 2022. The FCA is keeping under review any plans for continued publication on a synthetic basis of one-month, three-month and six-month U.S. dollar LIBOR settings after the end of June 2023.

    The FCA has also published its final policy on using some of the proposed new powers under the U.K. Benchmark Regulation (contemplated in the Financial Services Bill).

    View the FCA's statement.

    View ICE Benchmark Administration's statement.

    View details of the FCA's statements of Policy on exercising its powers under the proposed revisions to UK BMR

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