Eurocredit and Fallback: Difference between pages

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The Eurocredit market is where highly rated borrowers can gain access to medium-term bank lending.
1. ''Interest rates - reference rates''.


A 'fallback' is a specified alternative reference interest rate, for use in the event that the originally envisaged reference rate is unavailable.


The loan can be denominated in one or several Eurocurrencies as can the interest and the principal.
"Whilst fallbacks are contained in existing documentation should a reference rate become (temporarily) unavailable, these were not drafted as a long-term solution [to the permanent retirement of LIBOR]."


The interest rate is normally fixed as a margin over a benchmark rate.
''ACT Briefing Note, Transition to risk free rate benchmarks.''
 
 
2.
 
Similar arrangements in other contexts.




== See also ==
== See also ==
* [[Alternate Base Rate]]
* [[Benchmark]]
* [[Benchmark]]
* [[Eurocurrency]]
* [[LIBOR]]
* [[Margin]]
* [[Reference rate]]
* [[Principal]]
* [[Risk-free rates]]
* [[Rated]]
 
 
===Other links===
 
[http://www.fca.org.uk/news/speeches/interest-rate-benchmark-reform-transition-world-without-libor A World without Libor - FCA speech - July 2018]
 
[[Media:ACT LMA Future of LIBOR Guide 0318.pdf| The future of LIBOR: what you need to know, ACT & LMA, March 2018]]
 
[[Media:Slaughter and May interest rate benchmarks.pdf| 2021: A Benchmark Odyssey, Practical Guidance for Treasurers on interest rate benchmarks, Slaughter and May]]


[[Category:Corporate_finance]]
[[Category:Accounting,_tax_and_regulation]]
[[Category:Investment]]
[[Category:Financial_products_and_markets]]
[[Category:Long_term_funding]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_reporting]]

Revision as of 19:48, 17 February 2019

1. Interest rates - reference rates.

A 'fallback' is a specified alternative reference interest rate, for use in the event that the originally envisaged reference rate is unavailable.

"Whilst fallbacks are contained in existing documentation should a reference rate become (temporarily) unavailable, these were not drafted as a long-term solution [to the permanent retirement of LIBOR]."

ACT Briefing Note, Transition to risk free rate benchmarks.


2.

Similar arrangements in other contexts.


See also


Other links

A World without Libor - FCA speech - July 2018

The future of LIBOR: what you need to know, ACT & LMA, March 2018

2021: A Benchmark Odyssey, Practical Guidance for Treasurers on interest rate benchmarks, Slaughter and May