Regional banks face soaring term SOFR spreads

Bid/offers hit 10bp as dealers price counterparty risk into non-cleared Libor transition trades


US regional banks under pressure from recent interest rate hikes are seeing the cost of hedging their loan books skyrocket due to heightened concerns around counterparty risk and a widespread shift from cleared Libor swaps to more narrowly traded bilateral contracts.

Ahead of Libor’s cessation on June 30, regional banks are moving the bulk of their loans to a term version of the secured overnight financing rate, or SOFR.

Hedging this exposure is proving increasingly costly for smaller lenders

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to View our subscription options


Want to know what’s included in our free membership? Click here

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here