London Interbank Offered Rate (LIBOR), once dubbed the world’s most important number, has been rocked by manipulation scandals and will be replaced by year-end 2021. What will supersede this benchmark is not yet known, but the uncertainty is set to cause ripples across the globe.
The transition away from LIBOR will be one of the largest transformations that firms will have to undertake in living memory, so delaying preparations is simply not an option. Firms should begin to assess their vulnerabilities and exposure, and carefully plan their strategy to navigate the changes. Firms that start the process early will have a smoother, less costly transition.