Amol Dhargalkar discusses how corporates can prepare for LIBOR transition with Axios
The companies that are being proactive are currently taking inventory of their total Libor exposure, moving agreements to new benchmarks where they can, and getting pricing indications to understand how to address their future needs, Dhargalkar says.
It’s a little like the tale of the boy who cried wolf. Regulators have been telling the market for more than a decade that the Libor rate benchmark’s end was nigh. But now that it’s really, seriously, going to end as of December, loads of big companies are unprepared.
Why it matters: Companies that don’t adequately prep for the death may wind up paying the price in time and money, Amol Dhargalkar, global head of corporates at financial risk adviser Chatham Financial, tells Axios.
Our expertise for corporates
Chatham provides the knowledge and expertise needed to manage the financial risk associated with interest rate, commodity, and foreign exchange volatility. We develop and implement hedging strategies for hundreds of public companies annually, based on deep and productive banking relationships, giving us market data and insights to enable you to secure the best pricing and terms. Our goal is to empower you to strengthen your financial position and support your company’s financial objectives.
With expertise across hedge accounting, regulatory compliance, valuations, and hedging transactions, we can support all aspects of financial risk management. Our ChathamDirect platform provides convenient workflow, robust analytics, and comprehensive accounting methodologies, supported by our unmatched commitment to client service. This unique combination of strategy, operations, and technology will empower you to run a best-in-class hedging program.
Our featured insights
Answers to five key questions as you prepare for LIBOR cessation and the fall back to SOFR
With 2023 and the cessation of LIBOR officially upon us, some companies are opting to let their debt and interest rate hedges “fall back” through the adoption of standard language. While it might appear that this is the most straightforward way to manage the transition, there are five main...
2023 corporate treasury trends
Corporate treasury and accounting teams face a daunting list of concerns as they plan for 2023. Inflation at multi-decade highs, a war in Europe for the first time in 75 years, global central bank tightening, a roller coaster ride in on equity prices, and recession fears all pose challenges to...
7 ways to maximize FX and commodity hedging impact while minimizing costs
Hedge program costs can range from forward points, to trading costs, to fixed and variable operational costs that include systems and personnel. Program benefits often include risk reduction, operational ease, and favorable accounting treatment. This article will address leading practices and...
Chatham's Q4 2022 outlook: Inflation, market volatility, and LIBOR transition
Watch Chatham's Managing Partner and Chair, Amol Dhargalkar, discuss key trends for the upcoming quarter like inflation, market volatility, and LIBOR transition.
The Wall Street Journal asks Amol Dhargalkar why companies are keeping LIBOR debt on their books
The Wall Street Journal spoke to Amol Dhargalkar to understand why companies are keeping LIBOR debt on their books rather than replace it with SOFR when they refinance their loans.
Amol Dhargalkar and Kevin Jones speak in Global Treasurer about corporate treasury's transition to SOFR
Despite some operational issues, global corporate treasurers have embraced SOFR and are working to transition their debt to the new benchmark. Speaking to Global Treasurer, Amol Dhargalkar and Kevin Jones discuss the progress of corporate borrowers making this transition.
SOFR for corporates: Considerations on debt and derivatives in 2022
As the LIBOR sunset date approaches, this article lays out the key considerations for corporations facing a SOFR trigger event in the debt or derivatives markets.
Amol Dhargalkar speaks to the Wall Street Journal about SOFR's rise in 2022
The Wall Street Journal spoke to Amol Dhargalkar about U.S. companies and financial institutions settling on a new interest-rate benchmark to replace LIBOR. Sales of corporate loans and derivatives tied to SOFR have soared in 2022, accelerating the shift away from issuing new debt tied to LIBOR.