Earlier today the Financial Conduct Authority (“FCA”) announced a consultation seeking comments on the winding down of one-, three- and six-month synthetic sterling LIBOR settings and on the future of the remaining US dollar (“USD”) LIBOR settings.
Background
On December 31, 2021, publication of 24 LIBOR settings ended. For one-, three- and six-month sterling and Japanese yen LIBOR settings, the FCA required the administrator of LIBOR to continue publication on a synthetic (and unrepresentative) basis from the end of 2021. Under revised regulatory rules in the UK, publication of a synthetic rate can only be compelled to be published by the FCA for up to one year at a time for a maximum period of ten years. This was to give the holders of certain legacy contracts more time to complete transition.
Meanwhile, the FCA also permitted five US dollar LIBOR settings to continue to be calculated based on panel bank submissions until the end of June 2023.
Consultation
The FCA is seeking views on the following:
The deadline to submit comments in response to the consultation is August 24, 2022.