The regulator said today that immediately after 31 December 2021 LIBOR will no longer be relevant in the case of sterling, euro, Swiss franc and Japanese yen settings along with the one-week and two-month US dollar settings.

Then, immediately after 30 June 2023, it will come to an end for remaining US dollar settings.

The FCA confirmed publication of most of the LIBOR settings will cease immediately after these dates.

The move away from LIBOR is being made as the Bank of England and FCA felt it was unsustainable and unsuitable for the widespread reliance placed upon it.

As such, both organisations have worked closely with market participants and regulatory authorities around the world to ensure that robust alternatives to LIBOR are available and that existing contracts can be transitioned onto these alternatives to safeguard financial stability and market integrity.

For mortgage lenders, the focus will be on the transition from legacy LIBOR-linked mortgage portfolios, including the legal mechanism to support this, according to Robin Penfold of law firm TLT

Lenders will need to determine the alternative interest rate to transition to, finalise the communications strategy (which will play a key role in ensuring good customer outcomes), and engage with third parties (including intermediaries and third party service providers), he told MFG.

“I expect to see the majority of lenders and portfolio-holders begin to communicate with mortgage borrowers about what LIBOR transition means for them in the first half of 2021,” Penfold added.

Nikhil Rathi, CEO of the FCA said: “Today’s announcements provide certainty on when the LIBOR panels will end. Publication of most of the LIBOR benchmarks will cease at the same time as the panels end. Market participants must now complete their transition plans.’

Andrew Bailey, governor of the Bank of England said: “Today’s announcements mark the final chapter in the process that began in 2017, to remove reliance on unsustainable LIBOR rates and build a more robust foundation for the financial system.

“With limited time remaining, my message to firms is clear – act now and complete your transition by the end of 2021.”