Global and U.S. financial services regulators are increasing their warnings on the impending end to the use of the London Interbank Offering Rate (LIBOR) as a reference rate in financial contracts and the risk to the global financial system if there is inadequate preparation by financial institutions. Most LIBOR settings are ending this year, with a few USD LIBOR settings continuing into 2023.

On June 2, 2021, the Financial Stability Board (FSB), a group of international financial regulatory authorities that monitors and makes recommendations about the global financial system, issued an updated “Global Transition Roadmap” setting out key actions and deadlines by which financial institutions should be completing their documents review for LIBOR and transitioning to other rates. By now, firms should have reviewed all existing LIBOR exposures, assessing whether the contracts provide for fallback rates, determining what changes need to be made and deciding on the process by which to amend them (such as assessing whether counterparties need to approve an amendment).