Our previous Accenture LIBOR Survey (2019) findings identified two groups of distinct respondents. The first is made up of firms with mature transition plans and investing heavily to complete their transition on time. They consist mainly of the large sell-side investment banks and capital markets participants who set the trade benchmark rates. These firms are actively driving their remediation and transition programs.
The second group consists of passenger types who approach the transition with more caution, hesitancy and less commitment. This group is characterized by buy-side and corporate firms who are more likely to be users of benchmark rates.
Nearly six in ten sell-side respondents to our latest LIBOR Survey (2020) identified operational readiness and conduct risk as a top transition challenge. As well, over half indicated that their client outreach was a top transition challenge.
As for their buy-side peers, the survey showed that they were still in the early stages of the transition. They are also challenged in preparing their firms to operationalize fallbacks, having a data driven and scalable factory operating model, and being able to maintain compliance with investment mandates and contractual covenants.