Solution-Banks weigh alternatives to libor replacement

Banks weigh alternatives to libor replacement

Reference no: EM132999943

Banks Weigh Alternatives to Libor Replacement as Companies Seek Longer-Term Rates

Summary: Questions:

Some big banks are evaluating if the reference rate that is backed by regulators as the best replacement for the scandal-plagued London interbank offered rate is the only option for companies, or if they should offer other rates. Many large U.S. financial institutions are providing the Secured Overnight Financing Rate, or SOFR, to corporate borrowers as part of the transition away from Libor. But SOFR may not cover all companies' needs, banks and corporate advisers say, because the benchmark lacks rates that are weeks or months in the future, making it hard for companies to plan around future interest-rate risk.

Why is Libor being phased out as a reference rate?
What is SOFR?
Discuss the alternative rates to Libor such as Ameribor, SOFR, and BSBY. What are they and why are there differences in the three-month rates for each referenced in the article?
What are the views of the Fed and SEC in relation to alternatives to Libor being considered by various banks?

Reference no: EM132999943

Questions Cloud

Single factor apt correctly describes returns : a) Portfolio A has a beta of 1.2 and an expected return of 10%. Portfolio B has a beta of 0.8 and an expected return of 9%. The risk-free rate of return is 4%.

Prepare journal entries on books of Twilight Corporation : On May 1, 2022, Twilight Corporation purchased a third patent for $8,775. Prepare the journal entries on the books of Twilight Corporation

Inter vivos intrafamily planning technique : Discuss the purpose, characteristics, and factors to be considered in using a given inter vivos intrafamily planning technique.

What the bond approximate modified duration is closest to : An investor buys a four-year bond, Assuming a 5-basis point change in yield-to-maturity, the bond's approximate modified duration is closest to

Banks weigh alternatives to libor replacement : Some big banks are evaluating if the reference rate that is backed by regulators as the best replacement for the scandal-plagued London interbank offered rate i

Develop a web-based information system : Develop a web-based information system using basic technologies such as mark-up languages, stylesheets, JavaScript, PHP, and databases.

Importance of the knowledge of business finance : Topic: The importance of the knowledge of business finance for an entrepreneur. If you supply an answer, please supply your reference.

What is the monthly loan payment : Annuity Payment and EAR - You want to buy a car, and a local bank will lend you $30,000. What is the monthly loan payment

What is the concept of the time value of money : What is the concept of the time value of money (TVM) as it applies to government bond offerings

User Account

All Pages

Banks weigh alternatives to libor replacement

Reference no: EM132999943

Reference no: EM132999943

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

Financial reporting and analysis

A report on financial accounting

Describe the types of financial ratios

Differences between sole proprietorship and corporation

Prepare a cash budget statement

What are the implied interest rates

State pricing theory and no-arbitrage pricing theory

Small business administration

Effect of financial leverage

Evaluate the basis for the payment to the lender

Importance of opps, ipps, mpfs and dmepos

Time value of money

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT