The London Interbank Offered Rate (LIBOR)—the rate used around the world to price financial products – will be discontinued across all U.S. banks by the end of 2021 with limited exceptions. LIBOR will no longer be accepted by Financial Regulators after June 30, 2023.
This change will affect some adjustable or variable rate loans and lines of credit like adjustable-rate mortgages (ARMs), reverse mortgages, home equity lines of credit and personal loans that use LIBOR as the index.
The federal government has recommended using a SOFR based index as the replacement index for loans that use LIBOR.
If you do not have a loan or product linked to LIBOR, then this transition does not impact you.
If you are not certain, check with your banker to make sure.
In line with our Best-In-Class promise, we have established a LIBOR task force to ensure a seamless transition.
Our transition plan:
Part of our transition plan includes reviewing each agreement that uses LIBOR and making sure there is language that allows the transition to a new index in the event LIBOR is discontinued. If there is no such language in the agreement, we will be making the necessary amendments to include language that allows the transition to a new index.
We are personally reaching out to each client who has a loan using LIBOR and ensuring clients are informed and prepared for the transition.
We also aim to minimize any possible disruption after the transition to ensure there is no disadvantage to either party.We appreciate your patience as we follow federal guidance and transition away from LIBOR.
Please do not hesitate to contact your Relationship Manager at any time.
The FDIC Money Smart Program is designed to boost your financial skills. You can explore Money Smart resources, as they are available 24/7.
These tools are free of charge and available for all, so remember to share the tools with your family and friends.
Please note: City National Bank of Florida does not offer tax, legal or accounting advice
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