LIBOR and reference rate reform

Start adding items to your reading lists:
or
Save this item to:
This item has been saved to your reading list.

The clock is ticking toward 2021 and the end of LIBOR – will you be ready?

A tremendous shift across financial markets is taking place. The London Interbank Offered Rate (LIBOR) is being replaced. Currently the benchmark for over US$350 trillion in financial contracts worldwide, the impact of the transition from LIBOR will be far-reaching for financial services firms, businesses and customers alike. Key impacted businesses and functions include:

  • Capital Markets
  • Commercial Lending
  • Retail Banking and Wealth Management
  • Investment Management
  • Insurance
  • Market Infrastructure
  • Corporate Treasury

Given the scope of the impact, planning for this transition must start with a comprehensive strategy.

loading-player

Playback of this video is not currently available

LIBOR and Reference Rate Reform: What is LIBOR and why replace it?

Karyn Daud and Nassim Daneshzadeh discuss what LIBOR is and why there are discussions around replacing it | Duration: 2:48

Opportunities emerge

As firms start to address the impact of LIBOR transition across their organization, opportunities become apparent:

  • To create new and differentiated products
  • To improve customer experiences and increase customer loyalty
  • To standardize and improve processes
  • To make internal improvements in agility, collaboration and decision making
  • To tackle “while you’re at it” projects

 

How PwC can help

The transition from LIBOR is market, not regulator driven and institutions and territories are preparing at different rates. PwC’s LIBOR and reference rate reform specialists in territories throughout the globe can help you assess, prepare for, and execute on the transition. We work with you across the entire lifecycle of the transition, including:

  • Program mobilization and governance
  • Impact assessment and transition planning
  • Contract management and remediation
  • Client & customer outreach and communications
  • Systems & process changes
  • Risk and valuation model changes
  • Managing related tax & accounting implications

 

The transition from LIBOR: across the globe – at a glance
  United States United Kingdom Europe Switzerland Japan
Selected Alternative Rate SOFR (Secured Overnight Financing Rate) SONIA (Reformed Sterling Overnight Index Average) €STR (Euro Short-Term Rate) SARON (Swiss Average Rate Overnight) TONIA (Tokyo Overnight Average Rate)
Working Group Alternative Reference Rates Committee (ARRC) Working Group on Sterling Risk-Free Rates Working Group on Euro RFR National Working Group on Swiss Franc reference rates (NWG) Cross-Industry Committee on JPY Interest Rate Benchmarks
Administrator Federal Reserve Bank of NY Bank of England European Central Bank SIX Swiss Exchange Bank of Japan
Key Features
  • Fully transaction-based
  • O/N
  • Secured
  • Fully transaction-based
  • O/N
  • Unsecured
  • Fully transaction-based
  • O/N
  • Unsecured
  • Based on transactions and binding quotes
  • O/N
  • Secured
  • Fully transaction-based
  • O/N
  • Unsecured

{{filterContent.facetedTitle}}

{{filterContent.facetedTitle}}

To discuss the latest market & industry developments in your territory or industry, and how LIBOR transition will impact your business, contact your LIBOR transition specialist

Contact us

Darren Ketteringham

Global LIBOR team, Partner, PwC United Kingdom

Frank Serravalli

US Financial Markets Practice Leader, Partner, PwC United States

Pieter Veuger

Banking and Capital Markets, Partner, PwC Netherlands

Tel: +31 (0) 88 792 5157

Justin Keane

Principal, Financial Markets, PwC United States

Sergey Volkov

Asia Pacific LIBOR team, Partner, PwC United States

Tel: +81 (0)90 9850 6016

Follow us