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The Alternative Reference Rates Committee (ARRC) recently published a white paper suggesting a fallback formula for the USD LIBOR ICE swap rate. The paper describes a formula that was developed by the ARRC Market Structure and Paced Transition Working Group to calculate a fallback from the USD LIBOR ICE Swap Rate to a spread-adjusted Secured Overnight Financing Rate (SOFR) Swap Rate. The ARRC Chairman stated that the paper “aims to aid market participants as they consider how to address the impact that the end of representative USD LIBOR will have for contracts referencing the USD LIBOR ICE Swap Rates.”
On March 24, 2021, the New York State legislature passed a Senate Bill (the
Bill) regarding the discontinuation of USD LIBOR, which will cease in mid-2023. New York State Governor Andrew Cuomo signed the Bill into law on April 6, 2021.
The new law applies with respect contracts governed by New York law for which U.S. dollar LIBOR (
USD LIBOR) is used as an interest rate benchmark. Similar to the version of the legislation that the ARRC originally proposed in March 2020, the final law, among other provisions, (i) prohibits a contract party from refusing to perform its contractual obligations or declaring a breach of contract as a result of LIBOR discontinuance or the use of the legislation’s recommended benchmark replacement, (ii) establishes that the use of the ARRC-recommended benchmark replacement (which will be based on the Secured Overnight Financing Rate (or SOFR) is a commercially reasonable substitute for and a commercially substantial equivalent to LIBOR, and (iii) prov
by Tyler Durden
Thursday, Apr 15, 2021 - 08:30 AM
Despite a bevy of banks now warning that this is as good as it gets and a sharp market correction is imminent, nothing could spoil the markets party overnight, overnight we saw futures reverse a modest weakness and rebound back to all time highs as investors cheered solid earnings reports from companies including Bank of America and BlackRock and waited what should be a blockbuster retail sales report.
At 8:00 a.m. ET, Dow e-minis were up 161 points, or 0.47%, S&P 500 e-minis were up 22.25 points, or 0.56%, and Nasdaq 100 e-minis were up 114.75 points, or 0.83%.
“We are probably entering the last stage of the pricing of the growth acceleration, and we see encouraging signs suggesting the ‘reflationary’ environment can continue and be supportive for risky assets in the near term,” Goldman Sachs Group Inc. strategists led by Alessio Rizzi wrote in a note. “Across assets we continue to prefer equity over credit, and fav