LIBOR Transition Background
The establishment of the RRUC comes on the heels of a significant transformation in the reference rate landscape. For decades, LIBOR was a pervasive reference rate that was embedded in a wide array of financial products worldwide.
While LIBOR’s use as a reference rate grew dramatically over time, the volume of activity underpinning LIBOR itself declined to the point that the rate posed risks to financial stability. Given how interconnected LIBOR had become in the fabric of financial markets by that point, the transition away from LIBOR to a more robust reference rate—such as the Secured Overnight Financing Rate (SOFR)—necessitated a decade-long effort that touched nearly every pocket of financial markets and beyond.
In the United States, the ARRC was convened in 2014 to facilitate an orderly transition away from USD LIBOR. With the completion of that transition in 2023, the ARRC was discontinued. For more information on the transition and on the ARRC, please see its archived website.
As the ARRC’s Closing Report notes, the transition represented one of the most complicated changes in financial market infrastructure that involved billions of dollars, countless hours of work, a global engagement, and in the U.S., even the passage of federal legislation.
With the lessons from that transition in mind, the RRUC was established to promote the integrity, efficiency, and resiliency of the use of reference rates more broadly and to promote the ARRC’s best practice recommendations. As the market has shifted to a broader reference rate landscape, the RRUC serves as an important forum to promote a global dialogue on the use of reference rates in the post-LIBOR world.
Key ARRC Publications on the Transition from LIBOR, and Resources on the Secured Overnight Financing Rate (SOFR)
ARRC Closing Report: Final Reflections on the Transition from LIBOR
Summary and Update of the ARRC’s Term SOFR Scope of Use Best Practice Recommendations