Final LIBOR panel ends as transition nears conclusion

investmentweek.co.uk:

The London Interbank Offered Rate reflected the cost of lending between banks, using quotes from panels of banks in 35 variants across five currencies.

The last remaining panel ended on Friday (30 June), the penultimate step in the retirement of LIBOR.

Only three synthetic settings will continue to be published, with the 1-, 3- and 6-month US dollar LIBOR settings available for existing contracts until September 2024.

The FCA extended the usage of synthetic US dollar LIBOR to September 2024 in April, extending the deadline past its previous end date of June 2023.

For 40 years, the London Interbank Offered Rate reflected the cost of lending between banks, using quotes from panels of banks in 35 variants across five currencies.  

Synthetic US dollar LIBOR to cease in September 2024

After banks were fined billions of dollars for trying to manipulate LIBOR to make a profit during the Global Financial Crisis, regulators made the decision to replace it with the Federal Reserve Bank of New York's Secured Overnight Financing Rate (SOFR).

However, there have been recent calls for a re-examination of the LIBOR scandal, following claims evidence was withheld from parliament and regulators and central banks «permitted» rigging.

All new use of synthetic US dollar LIBOR is now prohibited under the FCA's Benchmarks Regulation, the City watchdog said, with all major clearing houses having now converted cleared derivative contracts that referenced US dollar LIBOR to risk-free rates. 

Most uncleared derivative contracts that referenced US dollar LIBOR will also start using risk-free rates from today (3 July), under industry-agreed fallback language adopted through the ISDA Protocol, which is still open for market participants.

MPs