SOFR as a LIBOR Index Alternative

  • December 21, 2018
The Federal Home Loan Bank of Chicago (FHLBank Chicago) is preparing for the possible phase out of the London Interbank Offered Rate (LIBOR) by December 31, 2021. Over the past few months, the Secured Overnight Financing Rate (SOFR), a broad measure of the cost of overnight cash borrowings collateralized by U.S. Treasury securities, has gained traction in the market as the likely LIBOR alternative. 

As an important step in the development of SOFR markets, the FHLBank System has already begun issuing floating rate bonds linked to SOFR. 

What’s next for FHLBank Chicago?
As a next step in our preparation, we are monitoring SOFR market activity, evaluating the possible issuance of SOFR-indexed advances, and are seeking your feedback on your interest in floating rate advances indexed to SOFR. We encourage you to share any feedback or interest you may have regarding SOFR-indexed advances with your Sales Director. If there is member interest, FHLBank Chicago anticipates being able to offer SOFR-indexed advances in Q1 2019.


Contact Us

Please direct all media inquiries to:

Casey Reidy 
Director, Communications

Heather Bockstruck
Assistant Director, Communications