XLF - Federal regulators urge banks to avoid using LIBOR as reference rate

The Federal Reserve Board, Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency issued a statement today to encourage banks to stop entering new contracts that use USD LIBOR as a reference rate ASAP and certainly by the end of 2021, a timeline the government agencies had warned about for at least a year.Most loans set by banks are based on LIBOR. After several banks were found to have manipulated the rates, industry regulators looked to establish alternatives that would be less prone to manipulation, with SOFR chief among them.The administrator of LIBOR intends to end publishing one-week and two-month USD LIBOR settings immediately after their publication on Dec. 31, 2021 and the remaining USD LIBOR settings immediately after the LIBOR publication on June 30, 2023.Extending the publication of certain USD LIBOR tenors until June 30, 2023 would allow most legacy USD LIBOR contracts to mature

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Federal regulators urge banks to avoid using LIBOR as reference rate