ISDA responds positively to interest rate benchmark reform consultations

Article summary

The International Swaps and Derivatives Association (ISDA) has responded to the International Accounting Standards Board’s (IASB) and European Financial Reporting Advisory Group’s (EFRAG) consultations on the Interest Rate Benchmark Reform – Phase 2 – Exposure Draft—ED/2020/1. ISDA has responded positively to both, supporting them with the efforts to amend international financial reporting standards in response to interbank offered rate (IBOR) reform, agreeing as well with the proposed approach to update the effective interest rate when replacing an IBOR with a risk-free rate. In response to both consultations, ISDA finds that the amendments are necessary to facilitate an orderly transition to risk-free rates.