LIBOR Transition - how we can help you
LIBOR remediation is a requirement, not a choice - let us be the law firm to guide you through the LIBOR transition process.
By the end of 2021, firms will need to have replaced the London InterBank Offered Rate (LIBOR) and other IBORs with Risk Free Rates (RFRs). We can guide you through the IBOR transition process from identification and quantification of your IBOR risk, to analysis and remediation of your IBOR estate.
Developing an effective transition plan
The Financial Conduct Authority (FCA) is concerned that clear and appropriate governance underpins firms’ IBOR remediation processes. Identification and management of the prudential and conduct risks associated with the transition will be critical to ensuring firms have met their regulatory and legal obligations.
We have an extensive track record in advising clients on Markets in Financial Instruments Directive (MiFID II) product governance and ensuring effective implementation of the Senior Managers’ Certification Regime (SMCR). As such, we are ideally placed to help you develop your IBOR project plan and ensure the appropriate risk mitigants are in place by end-2021.
Firms will need to show an up-to-date understanding of industry initiatives, and the timeline and probability of delivery of proposed industry solutions. However, firms will face a significant burden on resources to keep track across the 5 IBOR currencies and 30+ working groups.
To address this challenge, we have developed the ‘IBOR Transition Tracker’, a digital tool which will enable you to keep up-to-date with the latest market, legal and regulatory information in the industry in an easy and cost-efficient way. Get in touch if you would like to see how our tracker can help you.
Firms will have to understand how LIBOR interacts with their business. This will require a detailed understanding of the way in which LIBOR is present in a firm’s pricing, valuation, risk management and booking structure, and detailed product-by-product legal expertise to identify and implement a remediation process.
We have the strength and depth of product expertise in relation to each of the key asset classes affected by the IBOR transition to help you understand:
- the changes you will need to make to your impacted contracts
- the legal requirements, practical implications and consequences of seeking amendment (or not transitioning), and
- the other compliance issues that will need to be considered.
Understanding your IBOR exposure
The scale of firms’ IBOR remediation exercises is unprecedented. It will be important to identify where, and how, technology solutions can simplify the process and provide cost-effective solutions.
We have partnered with Wavelength Law, a team of legal engineers, to identify the best client-specific solutions for their needs from the entire range of available technology products in the market. As a result, we are "platform" agnostic; the best technology solution is the one that works for your systems and needs.
This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.