FCA Chief Executive Urges Faster Transition Away From LIBOR

UK Financial Conduct Authority ("FCA") Chief Executive Andrew Bailey urged regulators and market participants to accelerate efforts to transition away from reliance on LIBOR.

One year after delivering a speech in which he asserted that LIBOR is unlikely to be sustainable past 2021, Mr. Bailey said that the "pace of [the] transition is not yet fast enough." He credited progress made to date, but noted that there has been a continuing increase in the number of contracts that reference LIBOR and that will mature after 2021.

Mr. Bailey acknowledged a statement from the Financial Stability Board ("FSB") that identifies overnight risk-free rates ("RFRs") as the most suitable replacement for LIBOR and other interbank offered rates. In that report, the FSB continued to support development and adoption of overnight RFRs, emphasizing that these rates are well grounded in robust transactions and reflective of general interest rate movements as opposed to bank credit