What Index Should Banks Use Now for Hedging and ARC Loans
On October 23, 2020, the International Swaps and Derivatives Association (ISDA) published the Fallback Protocol (Protocol) that allows firms that use LIBOR to transition to SOFR when LIBOR becomes unavailable. On November 30, 2020, ISDA and IBA announced that it will cease publication of the one-week and two-month US dollar LIBOR settings immediately following the LIBOR publication on December 31, 2021. ISDA and IBA further stated that the remaining US dollar LIBOR settings would cease immediately following the LIBOR publication on June 30, 2