LIBOR Transition
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Unlike LIBOR, Secured Overnight Financing Rate (SOFR) is an overnight rate, not a term rate. It's a broad measure of the cost of borrowing cash overnight, collateralized by U.S. Treasury securities, calculated by a volume-weighted median of this transaction-level data.
Background

For many years, TD Bank and financial institutions around the world used the London Interbank Offered Rate (LIBOR) as a benchmark for setting interest rates. However, LIBOR has ceased to be a reliable rate and is being replaced with alternative reference rates (ARRs).
The change was set in motion by the 2008 financial crisis which revealed LIBOR's lack of transparency and vulnerability to manipulation. Over time, however, as the number of transactions has decreased, it relied more heavily on subjective judgment.
LIBOR cessation announcement
On March 5, 2021 the ICE Benchmark Administration (IBA), the administrator for LIBOR, announced that it will stop publishing LIBOR as of the dates below:
In addition, they are extending the publication of remaining USD LIBOR tenors until June 30, 2023 to allow legacy contracts to mature or be renewed on an ARR before LIBOR ceases to be published.
More information is available at ICE LIBOR® Feedback Statement on Consultation on Potential Cessation.
Industry groups like the Federal Reserve Bank of New York's Alternative Reference Rates Committee (ARRC) and the International Swaps and Derivatives Association (ISDA) have been working to identify new reference rates based on observable transactions that represent actual market activity. The ARRC recommended the Secured Overnight Finance Rate (SOFR ) as an index to replace LIBOR in loans and other financial instruments.
Private industry providers have begun publishing other ARRs in addition to SOFR, including the credit sensitive rate such as the Bloomberg Short-Term Bank Yield index (BSBY) and Ameribor published by the American Financial Exchange.
Regulators will not require the use of any particular ARRs but are encouraging market participants to opt for robust, transparent alternatives to LIBOR.
TD Bank is currently offering SOFR-priced products and continues to evaluate credit sensitive ARRs for future use on a product-by-product basis.
Making the switch from LIBOR – TD adopts SOFI First strategy
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SOFR First strategy
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A seamless shift
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Statement differences