What are the key differences between sofr and libor

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Reference no: EM132719162

The London Interbank Offered Rate (LIBOR), has been used widely to set the rates for many financial transactions, such as business loans, corporate bonds and derivatives. LIBOR is scheduled to be phased out in 2021 and lose its status as the global interest rate benchmark and be replaced in the US with the Secured Overnight Financing Rate (SOFR). As a future business professional you will need to understand the challenges of this transition and their impact in both financial and non financial corporations. That knowledge will allow you to navigate easier these areas and contribute in finding ways to benefit from managing these developments.

Make at least one, 150 word original post discussing one of the following topics:

Question 1: Why is LIBOR been replaced?
Question 2: What are the key differences between SOFR and LIBOR?
Question 3: How are banks and non-financial companies preparing for the transition to SOFR?
Question 4: Which institutions have started using SOFR in their loan extensions?

Reference no: EM132719162

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