Harshil PatelFCA required IBA to continue its publication of 1-, 3- and 6-month sterling and yen LIBOR settings for an additional year after end-2021.
Following FCA’s consultation earlier this year, the majority of respondents agreed that the 1- and 6-month synthetic sterling LIBOR settings could cease in an orderly fashion at end-March 2023, or were neutral. Some responses noted that remaining exposure to these settings is low, and some said that having a confirmed cessation date could help support remaining transition efforts.
Accordingly, FCA has confirmed that it has no intention to compel IBA to continue to publish the 1- and 6-month synthetic sterling LIBOR settings beyond 31 March 2023, and therefore these settings will permanently cease immediately after final publication on 31 March 2023.
Lenders and borrowers will need to agree appropriate arrangements for any outstanding loans referencing sterling LIBOR. Responses to FCA’s consultation suggested that some private finance initiative (PFI) loans remain linked to 6-month sterling LIBOR, and FCA encourages all relevant parties to ensure these contracts are amended as a matter of priority.
