§5805 Benchmark for Loans

Summary

Banks may use any interest-rate benchmark they think fits for loans that do not use LIBOR. This rule covers loans made before, on, or after March 15, 2022. Banks must pick a benchmark that matches how the bank is funded, what customers need, and the bank’s products, risks, controls, and operations. The chosen benchmark must still follow the loan’s terms and other laws. A federal supervisory agency cannot take an enforcement step against a bank just because the bank did not choose SOFR. Definitions (one line each): Bank — a financial institution checked by a federal regulator. Covered action — a supervisory enforcement step or written finding from a review. Federal financial institutions regulatory agency — the agencies named in section 3302. Federal supervisory agency — the agencies listed in section 3401(7). Non-IBOR loan — a loan that does not use LIBOR or other interbank rates expected to stop being used as benchmarks.