Since 2014, regulators, industry bodies and various working groups of private-market participants have engaged in the reform of benchmark interest rates.
Following the announcement by the the UK Financial Conduct Authority (FCA) and the Alternative Reference Rates Committee (ARRC)'s of the cessation of certain IBORs immediately after 31 December 2021, MUFG has ceased offering all sterling, euro, Swiss franc, Japanese yen and all US Dollar LIBOR settings.
Although the remaining USD LIBOR settings will continue to be published beyond the end of 2021, MUFG will cease entering into new contracts that reference USD LIBOR following the recommendations by the regulators and industry working groups.
In the UK, the Financial Conduct Authority (FCA) confirmed their intention to use their supervisory powers under the UK benchmarks Regulation to formally prohibit the use of USD LIBOR in O/N, 1m, 3m, 6m and 12-month tenors by supervised institutions in new deals from 1 January 2022.
In the US, following the Alternative Reference Rates Committee (ARRC)'s recommendation that all market participants act now to slow their use of USD LIBOR and prepare for a smooth end to new LIBOR contracts. On 30 November 2020, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation issued a statement encouraging banks to cease entering into new contracts that use USD LIBOR by 31 December 2021. The circumstances recognized by the agencies when it could be appropriate to enter into new USD LIBOR contracts after 31 December 2021 are limited.
For more information on CHF LIBOR, EONIA, EURIBOR, EUR LIBOR, HBOR, JPY LIBOR, TIBOR, SIBOR, SOR, CDOR and USD LIBOR please refer to our table.
Read our Frequently Asked Questions on Navigating the IBOR Transitions:
- Navigating the GBP LIBOR Transition - Frequently Asked Questions
- Navigating the US$ LIBOR Transition - Frequently Asked Questions
- About the 2020 IBOR Fallbacks Protocol - Frequently Asked Questions
What are our plans?
MUFG has been engaging with clients on the transition away from LIBOR for over a year.
By working with various regulators, the industry and our clients to manage the successful transition of this market change. We are committed to working in partnership with our clients to support them through this transition and we encourage you to keep up to date with the latest industry developments in relation to IBOR reform and to consider its impact on your own business.
Where initiated, MUFG EMEA's position is not to participate in, or to facilitate, dealer polls post IBOR cessation. Please share any further queries with regard to dealer polls with your MUFG representative.
For further information
The Sterling Working Group publishes a monthly newsletter providing key news updates relating to the LIBOR transition in the UK and other markets. The Sterling Working Group's current and past newsletters can be found at www.bankofengland.co.uk in the section titled "Working Group newsletters".