Issue link: https://read.uberflip.com/i/1271078
4 Background and context First published in the mid-1980s, LIBOR became the benchmark interest rate to which investors and banks fix their credit agreements. It's a rate that is based on estimates from surveyed banks and their good faith. There are many similar rates across the globe using the same methodology as LIBOR. Usage of USD LIBOR by asset class: Share Maturing By: Volume (Trillions USD) End 2021 End 2025 After 2030 After 2040 Over-the-Counter Derivatives Interest rate swaps 81 66% 88% 7% 5% Forward rate agreements 34 100% 100% 0% 0% Interest rate options 12 5% 68% 5% 5% Cross currency swaps 18 88% 93% 2% 2% Exchange Traded Derivatives Interest rate options 34 99% 100% 0% 0% Interest rate futures 11 99% 100% 0% 0% Business Loans Syndicated loans 1.5 83% 100% 0% 0% Nonsyndicated business loans 0.8 86% 97% 1% 0% Nonsyndicated CRE/Commercial mortgages 1.1 83% 94% 1% 0% Consumer Loans Retail mortgages 1.2 57% 82% 7% 1% Other Consumer loans 0.1 -- -- -- -- Bonds Floating/Variable Rate Notes 1.8 84% 93% 6% 3% Securitizations Mortgage -backed Securites (incl. CMOs) 1.0 57% 81% 7% 1% Collateralized loan obligations 0.4 26% 72% 5% 0% Asset-backed securities 0.2 55% 78% 0% 2% Collateralized debt obligations 0.2 48% 73% 10% 2% Total USD LIBOR Exposure: 199 82% 92% 4% 2% Source: SEC CONTENTS 01/ Executive summary 02/ Timeline & latest updates 03/ Inherent challenges 04/ Loan servicing impacts 05/ RFR experience 06/ Sopra Banking Software in action