On March 30, 2021, the LMA published its exposure draft RFR documentation as recommended forms, and updated the documentation to reflect, among other things, the Sterling Risk-free Rate Working Group’s (the Working Group) updated conventions. The LMA also replaced their single currency SONIA and SOFR exposure drafts with two recommended form single currency RFR facility agreements, and updated their RFR terms.

Continue Reading LMA Publishes New RFR Documentation and Updates Exposure Drafts to Recommended Forms

On March 26, 2021, the LMA published a note outlining considerations for market participants relating to the use of forward-looking term SONIA reference rates (Term SONIA Rates).

Term SONIA Rates have been available in beta form since July 2020, and available for use since 11 January 2021. Term SONIA Rates are expected to have limited use as the UK authorities have made clear their preference for the market to adopt a broad-based transition to SONIA compounded in arrears for new transactions, with use of Term SONIA Rates being more limited than the current use of LIBOR, and with SONIA compounded in arrears being seen by the Bank of England and FCA as the most robust and reliable replacement rate for LIBOR.  However, it is acknowledged that Term SONIA Rates may provide an option for loan transition for some parts of the loan market.


Continue Reading LMA Publishes Note on the Use of Forward-Looking Term SONIA Reference Rates

As the end of Q1 2021 draws closer, the Working Group on Sterling Risk-Free Reference Rates (the Working Group) published a Q&A that aims to address the end-Q1 milestone for no new GBP LIBOR lending and a best practice guide for GBP referencing loans (the Best Practice Guide) on February 26, 2021.

As discussed in our previous blog post (which can be found here), the Working Group recommended that market participants should not initiate new GBP LIBOR referencing loan products expiring post 2021, after the end of Q1 2021. The Q&A has been prepared to highlight considerations that market participants should take into account and addresses important questions in relation to the end-Q1 milestone.


Continue Reading GBP Working Group publishes Q&A and Best Practice Guide

On January 28, 2021, the UK Loan Market Association (LMA) published exposure drafts of two multicurrency term and revolving facilities agreements which incorporate, among others, backward-looking compounded risk-free rates (the Exposure Drafts). In addition, the LMA published commentary on the Exposure Drafts, which aims to assist market participants in understanding the terms thereof. The Exposure Drafts are based on the LMA’s exposure draft switch rate agreements discussed in our earlier blog post. The LMA hopes that their publication will facilitate awareness of the issues involved in structuring multicurrency syndicated loans which use backward-looking compounded risk-free rates (RFRs).

Continue Reading LMA Publishes RFR Facility Documentation

On November 23, 2020, the Loan Market Association (the “LMA”) announced the publication of several new and revised documents, with the purpose of helping market participants incorporate appropriate transition mechanisms into their loan documentation.

Continue Reading UK Loan Market Association Publishes New and Updated LIBOR Transition Documentation

The LMA continues to encourage market participants to replace IBORs with RFRs as a reference rate in all contracts and make all necessary adjustments for using the RFRs as the standard benchmark. The LMA published exposure drafts of compounded SONIA and SOFR facilities agreements to enable market participants to consider certain structural issues related to