On December 16, 2022, the Board of Governors of the Federal Reserve System adopted final rule 12 C.F.R. Part 253, “Regulation Implementing the Adjustable Interest Rate (LIBOR) Act (Regulation ZZ)” (“Rule 253” or the “Final Rule”). Rule 253 identifies SOFR-based benchmark rates that will replace U.S. dollar LIBOR in certain financial contracts after June 30, 2023. Rule 253 will become effective 30 days after its publication in the Federal Register. 

The Final Rule responds to several rulemaking requirements of the Adjustable Interest Rate (LIBOR) Act (“AIRLA”), and resolves some remaining questions about how outstanding USD LIBOR contracts will transition to a replacement rate after USD LIBOR ceases publication.  

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