Read the latest articles and press releases about securitization and structured finance.

Press Releases

Structured Finance Association Applauds Committee Passage of LIBOR Transition Legislation

The Structured Finance Association (SFA) today applauded the House Financial Services Committee adopting and favorably reporting the Adjustable Interest Rate (LIBOR) Act of 2021 (H.R. 4616) to the full House of Representatives by voice vote. The legislation will ease the transition away from the London Inter-Bank Offered Rate (LIBOR), which is the benchmark index currently used, for example, to determine the interest rate that consumers pay on some credit cards, home equity lines of credit, reverse mortgages, and private student loans.

Press Releases

Structured Finance Association and Leading Financial Services Industry Groups Announce Support for the Adjustable Interest Rate (LIBOR) Act of 2021

In a letter to leaders of the House Financial Services Committee, the Structured Finance Association (SFA) was joined by other leading financial services industry groups in announcing support for the Adjustable Interest Rate (LIBOR) Act of 2021, which the committee is scheduled to vote on today.

Industry News

ARRC Announces Scope of Use for Term SOFR, Includes Certain Securitizations

On July 21, the Alternative Reference Rates Committee (ARRC) announced recommended conventions and use cases in relation to forward-looking SOFR Term Rates. The recommendations support the use of SOFR Term Rates for (i) bilateral business loans and (ii) certain securitizations with underlying assets that are themselves tied to SOFR Term Rates and where those assets cannot easily reference other forms of SOFR

Capital Markets Subcommittee Leaders Press Chairman Powell on LIBOR Legislation

Over July 14 and 15, Federal Reserve Chairman Jerome Powell delivered his Semi-Annual Reports to Congress in hearings before the House Financial Services and Senate Banking Committees. In the House, Rep. Bill Huizenga (R-MI) questioned Chair Powell on the transition away from LIBOR, saying: "You have been very committed in your support, as well as other financial regulators for completing the conversion away from LIBOR-based interest rate benchmarks. It's absolutely essential, to provide certainty for those tough legacy LIBOR contracts—you have expressed that in the past.”

Industry News

SEC’s Gensler Emphasizes BSBY Creates Similar Risks as LIBOR

On June 23, Securities and Exchange Commission (SEC) Chair Gary Gensler addressed the annual London City Week. In his speech, Gensler discussed concerns around the LIBOR transition and replacement rates, noting that the Bloomberg Short Term Bank Yield Index (BSBY) has many of the same flaws as LIBOR, including “an economic incentive to manipulate it.”

Industry News

CFPB Expects to Finalize LIBOR-Related Rulemaking in January 2022

The Consumer Financial Protection Bureau’s (CFPB) recently published spring agenda indicates that the agency expects to issue a final rule in January of 2022 regarding LIBOR’s expiration.

Industry News

Regulators Remind Banks to Speed Up LIBOR Exit

On June 11, during a meeting of the Financial Stability Oversight Council, top U.S. regulators from Treasury Secretary Janet Yellen to Federal Reserve Chairman Jerome Powell reminded banks to cease use of the LIBOR index.

Industry News

CEOs Concur Federal LIBOR Legislation is Warranted; Lawmakers Remain Divided on Environmental and Social Considerations in Financial Regulation

While CEOs agreed unanimously on the need for federal LIBOR legislation, House and Senate lawmakers demonstrated they remain sharply divided on what role financial institutions and their regulators should play in confronting environmental and social challenges.

Industry News

CLO Transaction Surge Expected Ahead of LIBOR Cessation

CLO re-financings and resets are expected to surge by year end as loan markets transition out of London Inter Bank Offered Rate (LIBOR). U.S. regulators have advised banks to cease originating LIBOR-based loans by December.

Industry News

ARRC Announces a Forward-Looking SOFR Term Rate Administrator

On May 21st, the Alternative Reference Rates Committee (ARRC) announced that it has selected CME Group as the administrator it plans to recommend for a forward-looking Secured Overnight Financing Rate (SOFR) term rate, once market indicators for the term rate are met.