Planning for LIBOR Transition
The LIBOR interest Benchmark is ending
On 5 March 2021 the Financial Conduct Authority confirmed that all LIBOR settings will either cease to be provided by any administrator or no longer be representative:
- immediately after 31 December 2021, in the case of all sterling, euro, Swiss Franc and Japanese Yen settings, and the 1-week and 2-month US Dollar settings; and
- immediately after 30 June 2023, in the case of the remaining US Dollar settings
Further details can be found on the FCA website.
31 March 2021
In line with the Working Group on Sterling Risk-Free Reference Rates (Sterling RFRWG) recommended milestones, NatWest Group (NWG) no longer offer new GBP LIBOR-linked loans from the end of March 2021. This milestone applies to all GBP-linked bilateral and syndicated new lending, including multicurrency facilities, as well as the amendment or refinancing of existing facilities which from 1 April 2021 must instead be linked to SONIA or an alternative Risk-Free Reference rate.
The Sterling RFRWG has issued a Q&A document and a Best Practice Guide to assist market participants in transitioning away from the use of LIBOR in the GBP loan market in accordance with the recommended milestones.
NWG is a member of the Sterling RFRWG and Chair of the Loan Enablers Task Force established to help facilitate the launch and adoption of SONIA loan products in the GBP market. NWG fully supports the Sterling RFRWG milestones and is actively working to help customers navigate away from LIBOR for both new and existing lending.