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How to Prepare for the End of LIBOR

What treasury should be doing now to bridge the gap to a new benchmark interest rate.

By David Mullen | July 15, 2021 at 02:18 PM
Stock illustration: Businesspeople trying to figure out how to cross a chasm

The end of LIBOR is approaching, and despite the bombardment of emails, publications, and media reports warning of this transition, many treasury teams are nowhere near the finish line.

As every corporate treasurer should be aware by this point, the end of the London Interbank Offered Rate (LIBOR) is not just a problem for banks and investment firms. Any company that has issued LIBOR-based floating-rate debt, entered into a swap or futures contract to hedge risk, or taken a loan with pricing tied to LIBOR will be impacted by the transition.

Navigating the path to a new interest rate benchmark should be a top priority for treasurers—as well as for CFOs, CEOs, and boards—for the rest of this year. But where should they start?

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