LIBOR -- tools to manage the transition
In case there was any doubt, yesterday the Federal Reserve Bank of New York certified through an internal audit process that the US replacement for LIBOR (the newly minted SOFR) is indeed compliant with global standards set by the International Association of Securities Commissions (IOSCO). Compliance was never in doubt, in part because U.S. policymakers helped write the standards together with international partners.
We will save for another day a comparative analysis of the new market-based benchmarks, except to note that the U.S. benchmark and the Swiss benchmark are collateralized while the European and Japanese benchmarks are not.
Put this together with the July 1 notice by the Financial Stability Board that policymaker commitment to implementing the LIBOR transition on time by year-end 2021 (if not before) and it becomes clear that the policy trajectory we identified for our PolicyScope Report readers in the spring remains on track. The transition away from LIBOR is not being slowed down by COVID-19.
Consequently, we have teamed up with our friends at Stratagem Partners to provide the attached White Paper. It highlights how policy has evolved and solidified during the pandemic. It also provides a high level overview of under-appreciated management and risk challenges associated with the pandemic.
Just click on the image on the left to download your free White Paper.
Stay tuned for more. We will be hosting a webinar on this topic at the end of the month. Watch this space for the webinar announcement.