Are AFSVision and AFS Level III currently capable of supporting the transition? YES! As of September 2020, AFS is the first (and only!) solution provider that can fully support all aspects of the four SOFR rate methods. This includes Compounding in Arrears, rate AND balance for syndications AND bilaterals. So while other vendors may claim they are ready, AFS is the only one that can deliver on that claim. When is LIBOR Going to end? AFS is following guidance from the Alternative Reference Rates Committee (ARRC) that LIBOR will cease as of December 31, 2021. LIBOR might still be available, but not reliable. Why? Because some of the 16- to 20-bank panel will not be providing it to the Bank of England or the FCA. Meaning, the median they will be using to publish will be from a lesser group/number of banks. Therefore, some investors might easily think there could be potential for manipulation and reject the rate. What Rate is replacing LIBOR? The ARRC selected the Secured Overnight Financing Rate (SOFR) as the recommended benchmark interest rate to be used in place of USD LIBOR. SOFR is an overnight, secured rate based on actual transactions in the repo market. It is considered to be risk free because its underlying transactions used to calculate the rate are secured by U.S. Treasury securities. The following SOFR conventions are recommended: Forward-Looking Term SOFR, SOFR Rate Compounded in Advance, SOFR Compounding in Arrears, and Simple Daily SOFR in Arrears. AFS systems already support three of the four, with Compounding in Arrears delivery on scheduled for August/September 2020. When will the SOFR rates be published? On March 2, 2020, the Federal Reserve Bank of New York began publishing a compounded 30-Day, 90-Day and 180-Day Average SOFR. The SOFR Averages and Index Data are available on the Federal Reserve Bank of New York’s website at https://apps.newyorkfed.org/markets/autorates/sofr-avg-ind. Additionally, daily SOFR in Arrears is available at https://apps.newyorkfed.org/markets/autorates/SOFR. When does AFS anticipate providing the LIBOR Transition Change (Requirements) Documentation? User documentation is supplied as part of the code delivery. Code and user guides for the first three SOFR calculation methods were delivered to all clients in December. Compounding in Arrears is scheduled to coincide with code delivery for both systems. What does AFS perceive as its biggest challenge with the LIBOR Transition? Supporting the operationalizing of SOFR Compounding in Arrears Interest Convention; however, we are confident that we can do so. Does AFS offer any custom LIBOR Transition support? Yes, please contact Dean Snyder at DSnyder@afsvision.com or your RM to review your requirements. Is there a timeline for the transition? AARC has published a Paced Transition Plan that includes specific steps and timelines designed to encourage adoption of SOFR.