LIBOR Transition and Issues in Sustainability-Linked Loans

Corporate partners Jill Bronson and Nicole Leimer coauthored an “Experts’ View” article for Thomson Reuters’s “Practical Law” that covers the London Interbank Offered Rate (LIBOR) transition, credit spread adjustments in Secured Overnight Financing Rate (SOFR) loans, sustainability-linked loans (SLLs) and issues addressed by parties in SLL negotiations.

The authors discuss lessons learned from the last days of LIBOR, whether they see any lingering concerns among market participants about living in a world without it and changes they see in market practice. They also address ESG amendment features versus true SLLs, as well as “greenwashing” and “greenhushing.”

In conclusion, the authors stated, “We expect that businesses will evaluate whether the benefits derived from SLLs will be worth the added expense of increasingly sophisticated operational controls, external ESG compliance monitoring, and gathering and presenting detailed ESG information.”

The full article is available for “Practical Law” subscribers.