Successful Transition from LIBOR: An Introduction

Financial institutions are in the process of transitioning all products and contracts away from LIBOR to alternative reference rates (ARRs) by the end of 2021. The endorsed replacement for USD LIBOR is the Secured Overnight Financing Rate (SOFR), a secured interest rate administered by the Federal Reserve Bank of NY. In this presentation, Cadwalader will introduce many different considerations across product markets for successfully effectuating the transition away from LIBOR, including: (1) the assessment of whether adequate fallback language exists in legacy contracts, (2) whether legacy contracts can be amended to incorporate fallback language or a new ARR, (3) how to manage risk for legacy contracts that cannot be amended, and (4) the various ARRs that are available to minimize value transfer between parties.