• BCMstrategy, Inc.

QOTD -- CFTC Speaks on LIBOR Reform

Throughout 2020, and with increasing urgency starting in June, the global regulatory policy community has been intensifying its efforts to urge faster progress regarding the transition away from LIBOR and other inter-bank offer rates. Many regulators have started hinting that draconian enforcement actions could become necessary.

Market participants have been pleading for pragmatism. The scale and complexity of the task create considerable challenges even for automated compliance systems. For example, at least six different methods exist to achieve conversion to a new risk-free rate.

Yesterday, the Commodity Futures Trading Commission made clear they have heard the concerns. The CFTC issued no less than three different No-Action letters providing a broad range of regulatory relaxations to support the LIBOR transition process.

The question now is whether other major regulators will provide the same or comparable pragmatic policy shifts.

Curious to learn more about the LIBOR transition and the macro issues in play? Just click on the image on the right to see related content and analysis.


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