FCA formalises ‘synthetic LIBOR’ plan to avoid disruption for markets and consumers

By Neasa MacErlean

The regulator has set out detailed plans to create a staging post along the transition out of LIBOR — by allowing the use of ‘synthetic’ sterling and yen LIBOR rates in all legacy LIBOR contracts that have not transitioned before 31 December this year. Cleared derivatives contracts are excluded from these provisions, however.