Minutes
Introduction
Following the cessation of most LIBOR settings at the end of 2021, the Working Group on Sterling Risk-Free Reference Rates (the “Working Group”) concluded at its January 2022 meeting that it had met its objective to “catalyse a broad-based transition to SONIA across sterling derivative, loan and bond markets”.
Following this meeting, the Working Group confirmed that all Sub-Groups and Task Forces – except for the Bond Market Sub-Group, Loan Enablers Task Force and Communications and Outreach Sub-Group – would close as the Working Group moved into 2022 in a new form, with new objectives, and with continued support from the Bank of England and FCA.
The new overall objective was to assist in finalising the transition away from LIBOR, via:
- Supporting the continued active transition of legacy contracts from synthetic sterling LIBOR to SONIA, and
- Considering any implications of non-sterling LIBOR transition in UK markets.
To aid transparency in its new form, the Working Group agreed that it would publish summaries of the meetings of its Sub-Groups and Task Forces. Please see below for summaries of recent meetings.
The Bond Market Sub-Group (the “BMSG”):
Chair: Paul Richards, ICMA
At the BMSG meeting on 3 September, the FCA and Bank of England briefed members on plans for the cessation of 1-, 3- and 6-month synthetic US dollar LIBOR on 30 September 2024. The main purpose of the meeting was to discuss preparations in the bond market for the cessation of synthetic US dollar LIBOR ahead of the FCA’s proposed cessation date and, in particular, to invite BMSG members to communicate any remaining concerns.
At the meeting, BMSG members confirmed that they had no remaining concerns and that they would be fully prepared for the cessation of synthetic 1-, 3- and 6-month US dollar LIBOR on 30 September.
Subject to FCA confirmation that synthetic US dollar LIBOR will cease on 30 September, members agreed to close the BMSG following the last publication of those settings.
Following the BMSG meeting, the FCA confirmed Opens in a new window on 5 September that synthetic US dollar LIBOR will cease as planned, and hence the BMSG was wound down on 30 September.
The Loan Enablers Task Force (the “LETF”):
Chair: Marc Myer, HSBC
Following FCA confirmation Opens in a new window that synthetic US dollar LIBOR will cease on 30 September, members agreed by written procedure to close the LETF following the last publication of those settings. Hence the LETF was wound down on 30 September.
The Communications and Outreach Sub-Group:
Co-Chairs: Ryan O’Keeffe, Blackrock and Phil Lloyd, Natwest Markets
Following FCA confirmation Opens in a new window that synthetic US dollar LIBOR will cease on 30 September, members agreed by written procedure to close the Communications and Outreach Sub-Group following the last publication of those settings. Hence the Communications and Outreach Sub-Group was wound down on 30 September.