U.S. banks are looking to automation to aid in the yearend phaseout of the London Interbank Offer Rate (Libor) and to comply with a not-so-friendly push from the Federal Reserve to do so by Dec. 31.
The automation challenges for banks with regard to the Libor phaseout are many, Ronak Doshi, vice president at IT research firm Everest Group, told Bank Automation News. These include changing how documents are processed and risk-managed — even on new transactions — and the added complication of banks possibly opting for competing reference interest rates like the Secured Overnight Financing Rate (SOFR), American Interbank Offered Rate (Ameribor) and Bloomberg Short-term Bank Yield Index (BSBY).
