The Reserve Bank of India (RBI) has issued an advisory to banks and different RBI- regulated entities asking them to take steps to guarantee a complete transition away from the London Interbank Offered Rate (LIBOR) from July 1.
Banks / Financial Institutions (FIs) have been suggested to make sure that no new transaction undertaken by them or their prospects depend on or are priced utilizing the U.S. Dollar LIBOR or the Mumbai Interbank Forward Outright Rate (MIFOR). As per the directive, the Financial Benchmarks India Pvt. Ltd. (FBIL) will stop to publish MIFOR after June 30.
Banks/FIs have been suggested to take all essential steps to guarantee insertion of fallbacks on the earliest in all remaining legacy monetary contracts that reference U.S. Dollar LIBOR (together with transactions that reference MIFOR).
“The banks/FIs are expected to have developed the systems and processes to manage the complete transition away from LIBOR,” the RBI mentioned including it will proceed to monitor the efforts of banks/FIs for guaranteeing a clean transition from LIBOR.
The Financial Conduct Authority (FCA), U.Ok., in a press assertion dated March 05, 2021 had introduced that each one LIBOR settings will both stop to be offered by any administrator or now not be consultant.
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