Freddie Mac Clears Path for New Index Rate Company Begins Purchasing SOFR-indexed Products and Launches SOFR-indexed Offerings
December 17, 2020 12:01 ET | Source: Freddie Mac Freddie Mac McLean, Virginia, UNITED STATES
MCLEAN, Va., Dec. 17, 2020 (GLOBE NEWSWIRE) Freddie Mac (OTCQB: FMCC) today highlighted the key milestones it achieved in 2020 as part of its transition from LIBOR (formally the London Interbank Offered Rate) to the Secured Overnight Financing Rate (SOFR). Freddie Mac made significant progress across the enterprise in support of this important effort for the industry. Among its most recent achievements, in November, the company for the first time began purchasing and securitizing single-family adjustable-rate mortgage (ARM) loans tied to SOFR.
Fannie Mae Advances Market Readiness For New Index Rate
2020 LIBOR Transition Milestones Position Mortgage Industry for Future
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WASHINGTON, Dec. 17, 2020 /PRNewswire/ Fannie Mae (OTCQB: FNMA) today highlighted the achievement of key milestones, as it continues advancing the mortgage market s readiness for the anticipated future cessation of LIBOR.
Through external engagement, including participation on the Alternative Reference Rates Committee (ARRC) and its working groups, and internal coordination through dedicated LIBOR transition program offices, Fannie Mae launched new Secured Overnight Financing Rate (SOFR)-based offerings, announced the discontinuation of certain LIBOR-based products, increased engagement in SOFR-based transactions which promoted market liquidity, and provided transparent information and disclosures to assist the market with the transition.
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The latest setback to the Libor transition came as little surprise to those involved in the process, calling into question the need for replacement rates in the first place