SFA Testifies Before Senate Banking Committee Hearing Advocating for Federal Legislation to Remedy Tough Legacy LIBOR Contracts
SFA CEO Michael Bright testified before the Senate Banking Committee on November 2, 2021, at a hearing entitled, “The Libor Transition: Protecting Consumers and Investors.” In his testimony, he stressed to lawmakers that “while small compared to the overall size of outstanding LIBOR contracts, $16 trillion [in tough legacy contracts] is still a large sum, posing a serious risk to the financial system” and “absent federal legislation, retirees and savers will be forced to absorb tens of billions of dollars in legal costs.”
Ahead of the hearing, SFA was joined by 19 other leading financial services trade associations on a letter reiterating there is no realistic ability to amend tough legacy contracts which creates uncertainty to our markets in the absence of federal legislation.
SFA has been a leading industry advocate for federal legislation ahead of LIBOR’s cessation among regulators and in both the Senate and the House of Representatives. Guided by the expertise of our members, SFA’s efforts include leading multi-year coordinated engagement with Hill staff and policymakers, co-leading a coalition of other financial services trade associations, serving as a member of the Alternative Reference Rates Committee (ARRC) including chairing the ARRC Securitizations Work Group, , and guiding intra-market collaboration to identify legislation models supported by all market participants and consumers, and testifying at a Congressional hearing on behalf of our members.
Through SFA’s advocacy, the push for federal legislation has received bipartisan support in both chambers of Congress.
A full replay of the November 2021 Senate Banking hearing can be found here: hearing | Hearings | United States Committee on Banking, Housing, and Urban Affairs (senate.gov)
A link to SFA CEO Michael Bright’s written testimony can be found here: SBC LIBOR Hearing Michael Bright Written Testimony FINAL (senate.gov)
More information on the House Financial Services Committee’s H.R. 4616 bill can be found here: H.R.4616 – 117th Congress (2021-2022): Adjustable Interest Rate (LIBOR) Act of 2021 | Congress.gov | Library of Congress
A replay of the HFSC’s markup of H.R. 4616 from July 2021 can be found here: Hybrid Markup Part 1 – H.R. 935; H.R. 2265; H.R. 3332; H.R. 3555; H.R. 4590… (EventID=113999) – YouTube
SFA Joint Trades Letter: Senate Banking Committee Hearing- November 2021
SFA Joint Trades Letter: Support for the Adjustable Interest Rate (LIBOR) Act of 2021- July 2021
SFA Financial Times Op-ed: Legislation Is Needed to Ease Shift From LIBOR- April 2021
SFA Submission for the Record: House Financial Services Subcommittee Hearing- April 2021