The UK Financial Conduct Authority (FCA) today issued final message before the end-March 2024 deadline and a reminder of the expected cessation of US dollar synthetic LIBOR at end-September 2024.
It is now 1 month until the 3-month synthetic sterling LIBOR setting ceases permanently on 28 March 2024. This is the last remaining synthetic sterling LIBOR setting, and its end marks another critical milestone in the transition away from LIBOR.
In November 2022, the FCA announced that it intends to continue to require IBA to publish the 3-month sterling LIBOR setting in synthetic form until end-March 2024, after which it will cease permanently. This was in line with the feedback received to the June 2022 consultation.
Ahead of the deadline, firms with outstanding sterling LIBOR exposures must continue their active transition efforts.
The FCA also reminded market participants that US dollar synthetic LIBOR is expected to cease in 7 months’ time.
In November 2022, the FCA consulted on its proposals for a synthetic US dollar LIBOR. In April 2023, the regulator confirmed its intention to require IBA to continue to publish the 1-, 3- and 6-month US dollar LIBOR settings in synthetic form until end-September 2024.
Market participants must ensure they are prepared for these final synthetic US dollar LIBOR settings to cease at end-September 2024.
Parties to contracts still referencing LIBOR should be taking steps to transition to robust, appropriate reference rates, re-negotiating with counterparties where necessary.
