With the UK Financial Conduct Authority's announcement in July 2017 that it will no longer compel or encourage panel banks to provide quotations for the purposes of calculating the London Inter-bank Offered Rate (“LIBOR”) after end-2021, the discontinuation of LIBOR in the near future has become a certainty, raising further questions on the fate of similar financial benchmarks adopted by markets worldwide and those which depend on LIBOR in its calculations.
In line with the increasing use of overnight interest rate benchmarks in other major currencies, the Association of Banks in Singapore and the Singapore Foreign Exchange Market Committee identified and recommend the Singapore Overnight Rate Average (“SORA”) as the most suitable and robust replacement for SOR moving forward (over alternatives such as a reform of SOR or adopting an enhanced SIBOR) in a variety of cash market products, including loans, floating rate notes/bonds, mortgages and other cash market instruments.
Should you require further information on this or any assistance with the amendments to be made to your current loan documentation, you may wish to contact the partner at WongPartnership LLP whom you normally work with or the following partner:
Bernadette TAN
Partner – Banking & Finance Practice
d +65 6517 8718
e bernadette.tan@wongpartnership.com
Click here to see Bernadette's CV.