19 For loan markets, SC-STS will publish by April 2021 market guidance on the transition of bilateral corporate and retail loans, and set out further guidance on market mechanisms for converting legacy syndicated and hedged loans by the third quarter of this year. This is expected to rely on active SOR to SORA transition in the derivatives market to establish relevant pricing references for the transition of syndicated and hedged loans, where coordination across lenders and borrowers is essential. 20 The key message is this: Banks should actively engage their corporate customers to pro-actively undertake legacy transition wherever possible by end 2021. While some customers may be inclined to adopt a wait and see approach, particularly since LIBOR and SOR discontinuation could be extended to mid 2023, it is important to bear in mind that SOR derivatives liquidity will start to decline in 2021. 21  There are two reasons for this: Liquidity in derivatives will start shi ing to SORA, particularly from April onwards, given the stop to new SOR cash products, and as all hedges on new cash product shi to SORA. Likewise, with SC-STS considering a cessation timeline for new SOR derivatives, likely before end-2021, market participants should expect SOR liquidity to decline further as  https://www.mas.gov.sg/news/speeches/2021/pushing-ahead-with-sor-sora-transition-in-2021  5/7  12/02/2021  "Pushing Ahead with SOR-SORA Transition in 2021" - Keynote Speech by Mr Leong Sing Chiong, Deputy Managing Director (Markets …  key banks will not be able to undertake new SOR derivatives transactions.
12/02/2021  "Pushing Ahead with SOR-SORA Transition in 2021" - Keynote Speech by Mr Leong Sing Chiong, Deputy Managing Director (Markets …  Speeches  Published Date: 02 February 2021  "Pushing Ahead with SOR-SORA Transition in 2021" - Keynote Speech by Mr Leong Sing Chiong, Deputy Managing Director (Markets & Development), Monetary Authority of Singapore, at ASIFMA Virtual Event: Singapore IBOR Transition on 2 February 2021 1 Good morning everyone. First, let me take this opportunity to wish everyone a Happy New Year! Let me also thank the Asia Securities Industry & Financial Markets Association (ASIFMA) and the Association of Banks in Singapore (ABS) for organising this webinar and inviting me to speak on the important issue of Singapore’s interest rate benchmark transition. 2 In the next 20 mins or so, I will do a brief recap of the key objectives and milestones that we had set out last year. I will then touch on some recent developments in the US and UK that have a bearing on our transition timelines, and I will finally outline what our priorities are for this year in the transition to Singapore Overnight Rate Average (SORA). Recap 3 Back in 2019, the financial industry in Singapore, represented by the ABS and the Singapore Foreign Exchange Market Committee (SFEMC) [1] , assessed that given the eventual discontinuation of USD London Interbank Oﬀered Rate (LIBOR) and SGD Swap Oﬀer Rate (SOR), the most sustainable and sensible path was to transition aﬀected SOR markets to SORA.