Regulatory Alerts2020-07-10
Added · Updated
Reform of interest rate benchmarks
The Hong Kong Monetary Authority issued this letter to update authorized institutions on the growing risks of LIBOR-linked exposures and their progress in developing transition plans. The regulator established mandatory milestones requiring institutions to offer alternative reference rate products by January 2021, include adequate fallback provisions in new contracts maturing after 2021 from that date, and cease issuing new LIBOR-linked products maturing after 2021 by June 2021. To support compliance, the HKMA facilitated the development of a transition guide by ASIFMA and a corporate customer note with the Treasury Markets Association.
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