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Libor Law Will Help Reduce Disruption for US Structured Finance
Proposed federal legislation is expected to minimize disruption risk related to the transition away from Libor for a substantial portion of the floating-rate US structured finance (SF) market if enacted into law, Fitch Ratings says in its update on the phase out of USD Libor. The Adjustable Interest Rate (Libor) Act proposes using the Secured Overnight Financing Rate (SOFR) plus a set spread as the common alternative rate in Libor contracts with no or impracticable fallback provisions. This rate would also apply when a contract lacks a specific alternative rate and no replacement benchmark rate has been selected by ... (full story)