In our last update we shared what our customers were saying about transitioning their existing Sterling LIBOR loans to alternative Risk-Free Rates (RFR) before the end of September. This next chapter looks at what’s been achieved so far and what remains to be done ahead of the official 31 December 2021 cessation of LIBOR deadline.


NatWest Group Treasurer and
LIBOR Programme SRO

Our LIBOR transition has been fully focused on supporting our customers while meeting the regulator milestones. Check out what the numbers tell us about what we’ve achieved so far.


Click through to check out the numbers

There are many colleagues involved in the changes needed for the LIBOR transition across the Group. Their sheer determination and focus can be seen in what we’ve achieved so far. Some achievements are more visible than others, however all of them important.    


In the 2021 GlobalCapital Covered Bond Awards, NatWest Markets was named GlobalCapital’s 

‘Best Bank for ALM and Libor Transition Management’ – with ‘moving early’, ‘extensively educating investors’ and ‘ensuring fair treatment for all stakeholders’ as some of the qualities associated with their efforts and expertise.


The LIBOR transition project team worked closely with Bankers and LIBOR Operations to successfully support clients by:
Removing LIBOR products from the Wealth portfolio – including loans, mortgages, investment backed lending, derivatives and internal deposits – ahead of schedule in Q3 2020.

 


 Developing a bespoke Migration Tracker and automatic Letter Generator Tool to support customers with existing LIBOR loans – with 37 different client letter templates. 



Making sure they have the knowledge and practical tools for clear, positive client communications – resulting in 0 client complaints recorded
to date.
The Lombard LIBOR transition team:
Successfully transitioned over 3000
 Lombard agreements away from
 LIBOR by the regulator deadline,
 using a number of methods.


Highlights include: The first transition of an existing agreement in Commercial Banking of £1.6 billion balances for Lombard Unit Stocking in March 2021. 

And - the fastest returned and signed Amendment Agreement – 
8 minutes from start to finish!
The Commercial Banking LIBOR transition team, together with front line colleagues and support teams:
Offered alternatives to LIBOR ahead of our competitors – being first
to market with various deals, including: first SONIA loan (National Express, June 2019) and the first syndicated (working with other banks) alternative rate loan (Tesco, Sept 2020).

Individually engaged with 3,200 customers, who between them have over 4,000 loans, to switch their LIBOR facilities to an alternative rate – and 2,200 so far have agreed to transition via new loan agreements.
Written to another 2,800 customers advising them of changes to
their LIBOR facilities to meet the 2021 deadline. 


Collaborated closely with NatWest Markets
and the Risk & Financial Solutions team
to ensure any loans being
transitioned happen
 concurrently with linked
derivative products.
The RBSI LIBOR transitions team successfully:
Gave the business access to the Loan IQ system to transfer the entire LIBOR loan book - £13 billion in facilities – from the legacy system. Making sure customers could be offered the new SONIA rate – and allowed the first transition away from LIBOR in May 2021.


Enhanced the RBSI Mortgage Platform to offer customers a seamless journey when moving to an alternative rate – providing a positive experience with 0 customer impact. 

 
Introduced and piloted the ‘Plan B’ activities early on, making sure customers complete their transition documentation by 30 September and offering further support where this hasn’t happened in time to meet the 31 December deadline.
The UBIDAC LIBOR programme team worked with front-line colleagues, as well as technology and operation teams to:
Successfully contact all relevant customers, resulting in more than 51% consenting to the transition already.

 Make sure we no longer use LIBOR products for any new business, thus fully achieving the regulator milestone.
Prepare the technology systems and operational processes to support the transition.
The close collaboration between the LIBOR transition team, the Supply Chain Finance business, the Brexit Team, the Cross Border team, the Risk team, and both internal and external Legal teams achieved:
The solution to enable the transition of our EEA and non-EEA Cross Border customers and suppliers’ banking facilities away from LIBOR.

 To make this a safe path, they had to navigate some complex considerations, including Brexit driven changes, numerous different legal jurisdictions, regulated and non-regulated environments, as well as bilateral and unilateral arrangements.

 As expected, we’re preparing for scenarios where the transition doesn’t take place within our expected timelines. This is important in order to continue to support our customers - keep their LIBOR linked facilities operational and still meet the 2021 deadline. 


 From October, we’re going to be turning up the volume on customer contact. Targeting those who haven’t agreed their transitions, setting out clearly what they need to do, and what it could mean for them if they don’t take action.


There are a number of key milestones that we’re working to in the journey to meet the regulator timelines. Anitha Baliga, LIBOR Transition Programme lead, provides some insights into these and what the regulators are saying to us - as we move towards the end of LIBOR.


 
 

Read the transcript here


The business hubs include detailed guidance, packs, FAQs, customer documentation, webinar replays on various LIBOR topics, and links to relevant external web sites about the LIBOR transition

Commercial Banking LIBOR hub

Trade and Working Capital LIBOR page

NatWest Markets LIBOR hub

Wealth LIBOR hub

Lombard LIBOR hub

RBS International LIBOR hub 

We’re not the only ones who have been focused on LIBOR – customers can find numerous other sources of information – on the FCA, Bank of England and Working Group on Sterling Risk-Free Reference Rates websites, and through trade bodies and advisors.

Ulster Bank Ireland DAC LIBOR hub

For subtitles on the video, please click on the closed captions icon (CC) in the bottom right hand corner.


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