BAFT Comments in response to the ARRC Consultation on Spread Adjustment Methodologies for Fallbacks in Cash Products Referencing USD LIBOR

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BAFT issued comments in response to the ARRC Consultation on Spread Adjustment Methodologies for Fallbacks in Cash Products Referencing USD LIBOR.

On March 25, 2020, BAFT issued comments in response to the ARRC Consultation on Spread Adjustment Methodologies for Fallbacks in Cash Products Referencing USD LIBOR. In addition to responding to the consultation, BAFT made the case that the lack of a forward looking SOFR term reference rate presents operational challenges for this business line and encouraged the ARRC to develop a working group focused on trade finance to address issues specific to this subset of the industry. The comments are posted on the Library of Documents page under Comment Letters.

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We have chosen to postpone our planned North America Annual Meeting, scheduled for May 3-6, and our Regional Bank Conference, scheduled for June 15-16. Both conferences will be rescheduled for November 2020 and consolidated with the 30th Annual Conference on International Trade.

To help stop the spread of the coronavirus (COVID-19), BAFT is following the Center for Disease Control’s guidance and recommendations. We have chosen to postpone our planned North America Annual Meeting, scheduled for May 3-6, and our Regional Bank Conference, scheduled for June 15-16. The health and well-being of our members, conference attendees, speakers, sponsors and employees is a top priority for BAFT and we believe this is the best way to ensure their safety at this time.

Both conferences will be rescheduled for November 2020 and consolidated with the 30th Annual Conference on International Trade. We are working closely with BAFT’s Board of Directors and the various Conference Planning Committees to deliver these programs in unison to maximize the value for attendees, speakers and sponsors. We will be in touch with the specific dates and hotel location once they are available.

We would like to thank the relevant committees and individuals who have dedicated their time and resources thus far to helping plan these events, and we remain committed to delivering these programs when it is safe and practical to do so.

We look forward to welcoming you later this year as your continued support is paramount to our joint success.

If you have any questions, please contact us at events@baft.org. We appreciate your understanding, and we apologize for any inconvenience this may have caused.

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Due to growing concerns around the coronavirus (COVID-19) and subsequent travel restrictions, BAFT has rescheduled its upcoming 2020 MENA Bank to Bank Forum from March 18-19 to September 1-2.

In light of the growing concerns around the coronavirus (COVID-19) and subsequent regional travel restrictions, BAFT has decided to postpone its upcoming Middle East and North Africa (MENA) Bank to Bank Forum scheduled for March 18-19, as well as the Master Participation Agreement (MPA) Pre-Conference Workshop on March 17, both to be held in Dubai, UAE. The health and well-being of our members, conference attendees, speakers, sponsors and employees is a top priority for BAFT and we believe this is the best way to ensure their safety at this time.

We have rescheduled the MENA Bank to Bank Forum for September 1-2, while the MPA Pre-Conference Workshop is now scheduled for the afternoon of August 31, both in Dubai. All registrations will be transferred accordingly. If you are no longer able to attend the meeting due to the date change, please contact events@baft.org.

Currently, all other BAFT conferences remain on schedule and unchanged. Our staff experts will continue to track developments regarding the coronavirus in close coordination with public health officials. We will update you should there be any additional changes to BAFT’s conference schedule. Attendees with questions should feel free to reach out to the BAFT events team directly at events@baft.org.

We appreciate your understanding.

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BAFT recently updated its chart of information required by over 50 jurisdictions for the processing of both inbound and outbound USD wire transfers.

BAFT first issued the chart in 2016 as an appendix to the paper entitled Practices and Guidance for Formatting Payments and Handling Inquiries Related to the Financial Action Task Force (FATF) Recommendation 16.

A group of experts on large-value, cross-border payments sitting on BAFT’s Payments Committee brought the information in the chart up to date through end of calendar year 2019.  Samantha Pelosi, Senior Vice President for Payments & Innovation at BAFT remarked that, “We are happy to provide this invaluable resource to the correspondent banking community again this year.”

The chart available to BAFT members at no charge and to non-members for a nominal fee.  It can be found on the BAFT website in the Library of Documents, under “Best Practices and Industry Standards”.

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Following recent announcements by regulators and commentary by working groups on the importance of completing the transition to risk-free rates (“RFR”s) by end of 2021 (or in some cases earlier), BAFT and ITFA issue this joint statement as an update to the Guidance Note published May 2020.

Given the importance of transitioning to risk-free rates by the end of 2021, BAFT together with the ITFA are issuing this joint LIBOR transition progress note addressing the transition’s impact on the BAFT Master Participation Agreement (MPA). This is a follow up to an initial note published in May 2020 which introduced the challenge and requested that BAFT MPA users refrain from developing their own language for LIBOR replacement.  At that time, we provided high level disclaimer wording for use in marketing materials, etc. in order to avoid insertion of any institution specific wording in the MPAs to allow for maintaining the integrity of the document in the market.

Now we are pleased to share this latest update jointly drafted by ITFA and BAFT for the benefit of its respective members. This document addresses the impact of the LIBOR transition on the BAFT MPA, a broader update on the timing of the LIBOR transition and, lastly, some recommended next steps.

We will continue to work closely with ITFA on this matter and provide further updates as more clarity emerges.

To read the LIBOR Transition Progress Note: Impact on the BAFT MPA, visit our Library of Documents under the BAFT Standard Documents section or click here.

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On February 13, 2020, the Global Supply Chain Finance Forum (GSCFF) made up of the major global associations representing the trade finance market including BAFT, FCI, the ICC, the ITFA and the EBA, published a Payables Finance white paper to allay concerns and clarify what Payables Finance is and how it works.

BAFT, a member of the Global Supply Chain Finance Forum (GSCFF), jointly published with its forum partners the EBA, FCI, the ICC and the ITFA the white paper titled Payables finance-how it helps global supply chains. The white paper is a factsheet from the GSCFF that explains the SCF Payables Finance technique-how it works and why, and when appropriately used, how it benefits supply chain buyers and suppliers.

To view the white paper, visit our Library of Documents under the White Papers section.

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