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ARTICLE · 07 JUNE 2019

The ARRC's Final Fallback Language Recommendations For New LIBOR Syndicated Loans

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During the past month, the Alternative Reference Rates Committee ("ARRC") has published its final recommendations for LIBOR fallback language for floating rate notes, syndicated loans, securitizations, and bilateral loans.

United StatesFinance and Banking
J. Paul Forrester
J. Paul Forrester
Mary Jo N. Miller
Mary Jo N. Miller
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In our Legal Update dated May 2, 2019,1 we discussed the April 25, 2019, fallback language recommendations of the Alternative Reference Rates Committee ("ARRC") for new issuances of LIBOR floating rate notes ("FRN Recommendations"). On April 25, the ARRC also published its recommendations for syndicated loans, titled "ARRC Recommendations Regarding More Robust Fallback Language for New Originations of LIBOR Syndicated Loans" ("Syndicated Loan Recommendations").2 The Syndicated Loan Recommendations are largely consistent with the FRN Recommendations, which the ARRC has stated to be one of its goals, but differ in that the Syndicated Loan Recommendations offer two alternatives for LIBOR fallback language for syndicated loan products: the "Hardwired" approach and the "Amendment" approach. In this Legal Update we discuss how the Syndicated Loan Recommendations differ from the FRN Recommendations, in terms of proposed LIBOR cessation events, replacement rates, and spread

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