ICE Benchmark Administration (“IBA”) and Refinitiv Launched Term SONIA Benchmarks

On 11 January 2021, IBA and Refinitiv launched their respective Sterling Overnight Index Average (“SONIA”) term rates (“Term SONIA”). Term SONIA, which is a forward-looking risk-free rate, has been developed as one of the alternatives to replace GBP LIBOR (which will cease to exist after the end of 2021). Similar to GBP LIBOR, Term SONIA is available in 1-month, 3-month, 6-month and 12-month tenors.

Progress is also being made to develop forward-looking Secured Overnight Financing Rate (“SOFR”) term rates (“Term SOFR”) in the US. In September 2020, the Alternative Reference Rate Committee (“ARRC”) published a Request for Proposals to select an administrator to publish Term SOFR. It is expected (and it is one of the ARRC’s 2020 transition objectives) that the selected administrator will publish Term SOFR during the first half of 2021, provided liquidity in the SOFR derivatives markets is sufficiently developed.