SBI awarded the mandate for the first SOFR linked
ECB deal by Indian Oil Corporation Limited
SBI and IOCL reach an important milestone in LIBOR transition with a USD 100 million deal for 5 years
First SOFR linked deal in the External Commercial Borrowing (ECB) market
Country’s largest commercial bank, State Bank of India (SBI) has been awarded the mandate for the first SOFR (Secured Overnight Financing Rate) linked ECB deal by Indian Oil Corporation Limited (IOCL). SOFR is an identified replacement for USD LIBOR which is expected to be phased out at the end of 2021. The sunset has been triggered by the decision of Financial Conduct Authority (FCA) in UK not to compel contributing banks for LIBOR calculation after December 2021.
On this occasion, Deputy Managing Director (International Banking Group), Shri C Venkat Nageswar, said, “It is the first SOFR deal in the ECB space and the transaction demonstrates SBI’s position as a leader in aligning its systems and processes to embrace Alternate Reference Rates (ARRs). IOCL, the largest public sector Oil Marketing Company in India, by availing the first SOFR linked ECB, will set the pace for smooth transition by Indian Corporates to ARR mechanism.”