ARRC publishes playbook to support transition from legacy Libor cash products

The Alternative Reference Rates Committee today released a playbook to help support the transition away from legacy Libor cash products. The playbook provides tools and resources, including a compilation of best practice recommendations and reference materials. It is not intended to provide legal advice.

The guide lays out several recommended steps to navigate the successful implementation of fallbacks for various cash products. These steps include: thoroughly assessing the fallbacks that are embedded in every U.S. dollar Libor contract; remediating those contracts where feasible to reference the Secured Overnight Financing Rate before June 30, 2023; adopting plans to communicate each contract’s fallback with affected parties for remaining USD Libor contracts; and making sure sufficient resources are allocated to ensure that rate changes are successfully put into effect.

In related news, Refinitiv—the ARRC’s chosen provider to publish fallback rates for cash products based on SOFR—announced that it will begin publishing ARRC-recommended fallback rates based on the CME Group’s Term SOFR rates in September 2022.