RBI asks banks to prepare for transition from LIBOR IANS 09 July 2021
In August last year, the RBI requested banks to frame a Board approved plan, outlining an assessment of exposures linked to LIBOR and the steps to be taken to address risks arising from the cessation of LIBOR, including preparation for the adoption of the Alternative Reference Rates (ARR).
"Banks and financial institutions are encouraged to cease, and also encourage their customers to cease, entering into new financial contracts that reference LIBOR as a benchmark and instead use any widely accepted ARR (Alternative Reference Rates), as soon as practicable and in any case by December 31, 2021," an RBI circular said on Thursday.