LIBOR Transition

Commencing  July 1, 2023, LIBOR rates for USD contracts shall be replaced by Secured Overnight Financing Rate (SOFR), the reference rates regulated by the US Federal Reserve Board. Bank customers who may have Islamic products or agreements (Financing products, Islamic derivatives for hedging purpose like the Sharia compliant Wa’ad and Profit rate swaps, any sharia complaint Investment products) using the London Interbank Offered Rate (LIBOR) will be affected.

 The objective is to inform SIB’s customers for the preparedness for this transition, including:

•        Understanding of the changes in the applicability of profit rates and its calculation methodologies;

•        Impact of the transition in terms of existing contracts that use LIBOR rates;

•        Liaise with the respective relationship managers to agree on terms that may apply

Other Alternative Reference Rates Replacing LIBOR

The following table outlines the alternative rates that will be replacing LIBOR.  For detail information about the LIBOR transition, please refer to the respective links and also reach out to our SIB Branch managers or Relationship Managers