Refinitiv Publishes USD IBOR Fallback Rates

Refinitiv, the Alternate Reference Committee’s chosen provider to publish fallback rates for cash products based on the Secured Overnight Financing Rate, today announced that its USD IBOR Institutional Cash Fallbacks are now available for immediate use as production benchmarks. In addition, Refinitiv said that, pending final approvals, it plans to launch USD IBOR Consumer Cash Fallbacks for one-week and two-month settings on Jan. 3, 2022.

Refinitiv’s cash fallbacks are for use in contracts that contain ARRC-recommended fallback provisions to address instances where USD LIBOR ceases or is non-representative. The institutional cash fallbacks may be used in corporate contracts by financial and nonfinancial companies, and include a number of different versions. The consumer cash fallbacks are based upon compounded SOFR in advance plus the spread adjustment, which is gradually introduced during the 12-month transition period immediately following LIBOR cessation or permanent loss of representativeness.

Refinitiv, the Alternate Reference Committee’s chosen provider to publish fallback rates for cash products based on the Secured Overnight Financing Rate, today announced that its USD IBOR Institutional Cash Fallbacks are now available for immediate use as production benchmarks. The ARRC—of which the American Bankers Association is a member—welcomed the news. “The official launch of Refinitiv’s Institutional Cash Fallbacks gives market participants another important tool to ensure the stability of legacy contracts that contain ARRC-recommended fallback language,” said ARRC Chairman Tom Wipf, vice chairman at Morgan Stanley. “With exactly one month to go before no new LIBOR, we urge market participants to take action now to ensure a smooth transition.”

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