Board of Governors of the Federal Reserve System

Consumer Financial Protection Bureau

Federal Deposit Insurance Corporation

National Credit Union Administration

Office of the Comptroller of the Currency

State Bank and Credit Union Regulators

April 26, 2023

Joint Statement on Completing the LIBOR Transition

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Purpose

Five federal financial institution regulatory agencies [Footnote 1

- The federal financial institution regulatory agencies are the Board of Governors of the Federal Reserve System (Board), the

Consumer Financial Protection Bureau (CFPB), the Federal Deposit Insurance Corporation (FDIC), the National Credit

Union Administration (NCUA), and the Office of the Comptroller of the Currency (OCC). End of Footnote 1.]

in conjunction with the state bank and state credit

union regulators (collectively, agencies) are jointly issuing this statement to remind supervised

institutions that U.S. dollar (USD) LIBOR panels will end on June 30, 2023. The agencies also reiterate

their expectations that institutions with USD LIBOR exposure should complete their transition of

remaining LIBOR contracts as soon as practicable. As noted in prior interagency statements, failure to

adequately prepare for LIBOR's discontinuance could undermine financial stability and institutions'

safety and soundness and create litigation, operational, and consumer protection risks. [Footnote 2

- See, e.g., the FFIEC Joint Statement on Managing the LIBOR Transition (July 2020) and the Interagency Statement on

Managing the LIBOR Transition (October 2021).2.] End of Footnote

Supervisory considerations

The agencies expect institutions to have taken all necessary steps to prepare for an orderly transition

away from LIBOR by June 30, 2023.

Expeditious transition of remaining legacy contracts

Institutions have reported significant progress in their LIBOR transition efforts; however, work remains

for institutions to prepare for the end of the USD LIBOR panels. Institutions are encouraged to ensure 

that replacement alternative rates are negotiated where needed and in place in advance of June 30, 2023,

for all LIBOR-referencing financial contracts including investments, derivatives, and loans. Institutions

are also encouraged to work expeditiously with their customers and coordinate with other institutions as

needed in these efforts.

In order to facilitate the transition, Congress enacted the Adjustable Interest Rate (LIBOR) Act (LIBOR

Act) to provide a targeted solution for so-called “tough legacy contracts,” which are contracts that

reference USD LIBOR and will not mature by June 30, 2023, but which lack adequate fallback

provisions providing for a clearly defined or practicable replacement benchmark following the cessation
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of USD LIBOR. [Footnote 3

- Public Law 117-103, div. U, codified at 12 U.S.C. 5801 et seq. End of Footnote 3.]

In January 2023, the Federal Reserve Board published a regulation that implements

the LIBOR Act. [Footnote 4

- 88 Fed. Reg. 5,204 (Jan. 26, 2023). End of Footnote 4.]

Examiners will continue monitoring efforts through 2023 to ensure that institutions have moved their

contracts away from LIBOR in a safe and sound manner and in compliance with applicable legal

requirements.

Appropriate alternative rate selection

The agencies remind institutions that safe-and-sound practices include conducting the due diligence

necessary to ensure that alternative rate selections are appropriate for the institution's products, risk

profile, risk management capabilities, customer and funding needs, and operational capabilities. As part

of their due diligence, institutions should understand how their chosen reference rate is constructed and

be aware of any fragilities associated with that rate and the markets that underlie it.