Yesterday, the FCA, Bank of England and members of the Working Group on Sterling Risk-Free Reference Rates released a statement on the impact of COVID-19 on firms’ LIBOR transition plans. 

The key message is that LIBOR will not be published after the end of 2021 and the current situation has not changed this date. As such, firms need to ensure that LIBOR transition remains a key focus.

That said, the statement acknowledges that COVID-19 will have an impact on some aspects of the transition programmes for many firms, particularly for those parts of the market that have made less progress in transition and are therefore still more reliant on LIBOR. The statement specifically refers to the loan market as an example.

Therefore, whilst COVID-19 may impact some of the interim transition milestones, firms still need to focus on this task as the ultimate deadline is unlikely to change.