Loans, CLOs Tied to Libor Should Cease Mid-2021, Fed Group Says

Companies should stop issuing leveraged loans tied to Libor by the end of June 2021, while money managers should no longer package the debt into CLOs linked to the rate by September of next year, according to guidelines from the Federal Reserve-backed committee steering the U.S. Libor transition.

The suggested deadlines are part of sweeping recommendations provided to market participants as regulators look to phase out the beleaguered benchmark by the end of 2021. Consumer loans including mortgages tied to the London interbank offered rate should cease by September, floating-rate notes by year-end, and securitizations other than CLOs as well ...