LIBOR / IBOR Transition and Benchmark Reform
This course is available on in-company basis and can be provided at the time and location convenient to you – contact us to discuss your requirements.
This 1-day LIBOR Transition course offers an insight into the journey from IBOR rates to their new replacement benchmarks, from the perspective of banks, companies, and investors.
The future of interest rate benchmarks is uncertain except for one thing: IBOR rates will be coming to an end in the next two years; and banks, companies, and investors need to be ready. Rocked by a rate-rigging scandal and latterly by the absence of an underlying market, regulators have called time on IBOR rates and are pushing the world towards more robust alternatives.
This course examines the role IBOR rates have played in finance, growing from almost nothing 40 years ago to one of the most important numbers in world markets; a number that underpins 100s of trillions of USD of cash and derivative contracts.
We look at the role of IBOR rates and what requirements their replacements need to satisfy, before examining the details of the regulatory-approved replacements – ‘the risk-free rates (RFRs)’. We then consider the transition process that must be undertaken by banks, companies, and investors to meet the regulators deadlines to be ready for the end of IBOR. We will look at the new RFR-linked bonds – how the bonds work and how they have been received by the market. We then will be looking at the role of IBOR in corporate lending, and how the transition to RFR-linked loans might work. We consider the tricky subject of a forward-looking RFR rate and how one might be determined. We then progress to the world of derivatives and the details, and pricing, of the new RFR-linked futures and swaps markets.
We finish the course by considering the process of migrating legacy IBOR deals to RFR-linked terms – the contractual considerations and how we agree a fair transition price. We examine the latest ISDA consultation results and discuss the likely calculation process for fallback rates for legacy interest rate derivatives, as well as the P/L consequences.
The course consists of classroom-based training which combines formal teaching of concepts and technical content, with individual and group exercises to reinforce learning points.
What will you learn
Attend this 1-day LIBOR / IBOR Transition course and learn about:
- What has gone wrong with IBOR rates and why a replacement is needed
- The chosen the replacements – the new ‘risk-free rates (RFRs)’
- The differences between IBOR rates and the new RFRs
- The transition process from IBOR to RFRs for banks, companies and investors
- How RFR-linked bonds work and the market for them
- The change in the world of corporate lending towards RFR-linked floating rate loans
- The new RFR-linked derivative products and their pricing
- The process of migrating legacy IBOR deals on to RFR terms
- The latest ISDA consultation results on fallback rate calculation
You may be also interested in one of the following programmes:
Main topics covered during this training
- IBOR and its replacement ‘Risk-Free Rates’ (RFRs)
- Issuing bonds linked to the new RFRs
- The transition from IBOR to RFR
- Corporate lending linked to the new RFRs
- Derivatives referencing new RFRs
- Migrating legacy IBOR deals
Who should attend
- Corporate bankers – relationship managers and treasury managers
- Bank money market, bond and derivative traders and salespeople
- Bank middle office and operations staff
- Investors – institutional investors, fund managers, private traders
- Company treasury managers and staff, accountants, risk managers
LIBOR Transition and Benchmark Reform – A 1 Day Training Course
IBOR and its replacement ‘Risk-Free Rates’ (RFRs)
- IBOR – What was the original purpose of IBOR, how is it set and what went wrong?
- The necessity for replacement
- The regulatory-favoured RFRs
- What are the chosen RFRs in each major currency?
- Description of each RFR
The transition from IBOR to RFR
- What role does IBOR play within a bank?
- The transition from IBOR to RFRs
- What will drive liquidity in the RFR bank-funding market?
- What is the impact of RFRs on floating-rate borrowers?
- What will drive the movement from IBOR-linked to RFR-linked borrowing?
- Managing the transition for a corporate borrower
- What are the requirements of floating-rate investors?
- How will investors become comfortable with the transition away from IBOR?
- How are regulators driving the transition from IBOR to RFRs?
- In the post-IBOR world, what have we gained (or lost)?
Issuing bonds linked to the new RFRs
- The market place for RFR-linked floating rate bonds
- What do investors want?
- What is the process of issuing bonds linked to the new RFRs?
- Issuance to date by currency and issuer type
- Investor reaction to RFR-linked floating rate bonds
- Pricing of RFR-linked bonds
- In theory, how should the RFR spread be priced?
- The IBOR/RFR basis
- How has the market priced and absorbed the bonds issued?
- Bond term sheet details
- Fixing source
- Rate and settlement calculations
Corporate lending linked to the new RFRs
- Why is IBOR so popular in corporate loans?
- How would an RFR-linked corporate loan work?
- The problem with the ‘forward-looking term loan’ nature of IBOR
- How do we replace a 3-month rate with and overnight rate?
- Why does the corporate loan market need a ‘term’ rate, e.g. 3-month ESTER?
- How do we develop a ‘forward-looking term rate’ for RFRs?
- Probable corporate loan characteristics post-IBOR
- Fixing sources for term RFRs
- Rate and settlement calculations
- Pricing versus IBOR-linked equivalent
- Pricing corporate loans
- Replacing the credit and liquidity information from IBOR
- Using RFRs to determine FTP rates
Derivatives referencing the new RFRs
- Why is IBOR used in derivatives contracts?
- Replacing IBOR in FRA, Futures and IRS trades
- Existing market for overnight index futures
- New RFR futures contracts
- What is the existing market for overnight index swaps (OIS)?
- How would a swap market based upon new RFRs work?
- Hedging using RFR-linked swaps
Migrating legacy IBOR deals
- The case for migrating legacy IBOR deals to the new RFRs
- Complications in floating-rate bonds and corporate loans
- Does current documentation contain fall-back provisions to deal with the end of IBOR?
- Transition to RFRs for floating-rate bonds
- What do borrowers and investors require from the transition and how can these requirements be met?
- How do we price the replacement bond coupon to make the transition fair to both sides?
- Transition to RFRs for corporate loans
- What do companies and banks require from the transition and how can these requirements be met?
- Dealing with the choice of term RFR and reset rate source
- How do we price the replacement loan margin to make the transition fair to both sides?
- Derivatives transition
- The latest on the ISDA consultations
- The final design of a fallback rate
Mark spent 10 years as an FX and interest rate derivatives trader in London, HK and New York before moving into financial training, where he has spent the last 9 years. His trading experience spans vanilla and exotic products having run profitable businesses across the derivatives product spectrum.
Mark graduated from the University of Bristol with a first-class degree in Aeronautical Engineering. He had a brief stint as an aerodynamicist working on military aircraft design for BAe Systems, before moving into finance, first with Deutsche Bank and then RBS.
After leaving finance Mark bought, ran and subsequently sold a retail business; in the process developing a first-hand understanding of company valuation, accounting, as well as company financing and risk management.
Mark uses his experience in financial markets and the corporate world to run engaging training courses across both the markets and corporate finance disciplines.
Companies Mark has trained include: HSBC, JP Morgan, Barclays Bank, Deutsche Bank, Rabobank, Morgan Stanley, Standard Chartered Bank, ING, RBS, Saudi Hollandi, Cantor Fitzgerald, National Bank of Kuwait, Sumitomo Mitsui Banking Corporation, Société Générale, European Bank of Reconstruction and Development (EBRD), RBC, UniCredit, Commerzbank, just to name a few.
Most of our public courses are run over 2 full days. Some programmes are offered as a 1 or 3 day training.
In-house training is tailored to client’s requirements and can be organised over 1 day, 2-3 weeks or longer.
Public courses are organised mainly in London and Dubai. Occasionally we organise courses in other centres like Paris or New York. Check our public course calendar for the current list of programmes. We use a range of training venues, all in the centre of the cities and with excellent transport links to the airports and train stations.
In London we use venues in the centre (near Oxford Circus station or in Mayfair) or in the City (near Liverpool Street or Moorgate stations).
In Dubai our courses are organised in one of 4-5* hotels in the Deira district. Once you register we will send you detailed information together with accommodation options if required.
Our in-house courses can be delivered anywhere in the world. We work with over 25 trainers worldwide. Contact us do discuss your requirements. Check our list of available programmes.
Our courses are run in central locations from 9 a.m until 5-5.30 p.m. There are 2 coffee breaks and a lunch break. Lunch is always provided in the venue.
Dress code is smart casual.
All our programmes are taught by senior specialists who have spent many years in their respective sectors, working as senior managers and head of departments, so they understand very well the market and the challenges you are facing.
The experience of our trainers allows us to create very practical programmes, focused on current market trends and challenges. You can be sure that you will gain the knowledge which can be instantly applied in your workplace after the course. You will be analysing real life case studies, take part in group exercises and discussions as well as role plays, whenever applicable.
We want our courses to be as practical and interactive as possible so we limit the number of participants in order to optimise your time with the trainer and allow you to ask questions which are important for you.
In order to understand your requirements and expectations, we will send you a pre-course questionnaire.
You will also receive post-course support so if you have any questions after you left the training, you are welcome to contact us.
There are 2 easy ways to register:
- Go to the course of your choice and click Register Now button to fill the registration page
- Email us to firstname.lastname@example.org
After you register, we will send you registration confirmation and an invoice so you can arrange the payment. Please note that your place is not confirmed until we receive it.
If you register within Early Bird discount period, there’s limited time to arrange the payment in order to be eligible for the discount. You will find all the details on the invoice.
We don’t advise to make any travel and hotel arrangements until you receive full course confirmation from us.
We will send you venue and course details as soon as possible but most likely about 3-4 weeks prior to the course commencement.
You can pay by:
- Making a bank transfer
- Debit/credit card
- Cheque payable to Eureka Financial Ltd. - only within UK
Just mark preferred paying option on the registration form. Whichever form of payment you choose we will always send you an invoice.
If you pay by card, a 2.2% processing fee will be added. We will send you authorisation form so you can give us your card details.
Included in the price of a public course are:
- Course tutorial
- Take away course materials
- Course Certificate
- Lunch on the days of the training as well as drinks and snacks throughout the course
The price doesn’t include accommodation, flights, transfers and any additional costs outside of the training venue.
Yes, we always offer Early Bird discount, so the sooner you register the more savings you can make. We also offer group discounts and if you register for 2 or more programmes at the same time.
If you are a full time student or unemployed, we offer a 25% discount of the full price of the training. Student ID or unemployment status confirmation is required to claim this discount.
If you attend one of our courses you will be entitled to a special discount for a year after the last course you attend with us. Also, if you have attended and recommended us to a friend, both you and your friend will receive a special discount. You will receive more information about it after you attend the course.
See our Customer Loyalty Discounts page for more details.
All our courses based in the UK are subject to the VAT charge of 20%. This fee is irrespective of the country of residence of the delegates.
You can, however, claim the VAT back by contacting UK tax office - HMRC, and filling the relevant form, as long as you comply with the following rules:
For Delegates coming from the EU countries
If you represent a registered business in another EU country, you can use the Refund Scheme to reclaim VAT you pay in the UK as long as all of the following apply:
- You're not registered for VAT in the UK and don't have to, or can't be, registered here
- You don't have a place of business or a residence in the UK
- You don't make any supplies in the UK
You can find some more information here. In order to claim the VAT you have to fill Form 65.
For the Delegates from Non EU countries
If you represent a registered business in a non-EU country, you can use the Refund Scheme to reclaim VAT you pay in the UK as long as all of the following apply:
- You're not registered for VAT in the UK and don't have to, or can't be, registered here
- You don't have a place of business or a residence in the EU
- You can only use the Refund Scheme if your own country operates a similar scheme and makes it available to UK businesses. If your country has its own Refund Scheme but doesn't let UK businesses use it, you can't claim under the UK Refund Scheme.
- You don't make any supplies in the UK
If the following rules apply to you, please fill the 65A form and send it to HMRC.
You can cancel your participation up to a month before the course and receive a refund minus 10% of the full course value. Between 2-4 weeks before the course you will be charged 50% cancellation fee and if you cancel less than 2 weeks before the course you can only offer your place to a colleague. Up to 2 weeks before the course you can reregister for another edition for 10% reregistration fee if there is another webinar offered or you can rebook for a course in London by paying the difference in price plus 10% reregistration fee.
If there is any official travel restriction or difficulty related to the COVID pandemic around the time of the course we will convert the training into a webinar or offer to attend the next classroom edition at no extra cost.
If you are unable to attend the course, you can either send a replacement at no extra charge or, up to 10 days before the training, you can transfer your booking to another edition within the next 6 months paying administrative fee of 20% of the full course price. For any cancellation requests received between 11 days and 4 weeks from the course we offer 50% refund or reregistration to another edition for 25% of the value of the booking. For any cancellation requests received more than 4 weeks before the course date we will offer a refund less an administration fee of 10% of the full course price.
Cancellations must be made in writing (letter or email) and reach our office four weeks prior to the course date. We regret that only limited refunds can be given after this period as per points above. Non-attendance without any notification will be charged at full rate. Your place on a course is not guaranteed until we receive the payment. All payments must be made in full before the course date.
All our trainers have been working for many years in their respective sectors before they begun to teach so they bring a wealth of practical experience to the classroom.
Most of them used to work for 15 or more years in the financial sector and corporate world, and were holding positions of Directors, VP and Senior Managers. Some of them have published books and have written articles for specialised magazines and newspapers including FT, The Independent, The Times etc. You can find detailed biography of each trainer on the page of the course you want to register for.
Yes, you will receive a Certificate of Attendance at the end of the course you attend.
If you have to apply for a Visa to attend a course in the UK, we will issue a letter to support your application. The letter will be issued only after the payment for the course has been made.
It is delegate’s responsibility to obtain a Visa and failure to do so will not make the participant exempt from the cancellation policy.
Anyone suspected of applying for a training course simply to gain a Visa letter will be reported to their embassy.
We will need the following information to issue an invitation letter:
- Full name as it appears on your passport
- Date of birth
- Passport number
- Passport issue date
- Passport expiry date