SOFR-based transactions will enter Bangladesh through Eastern Bank Limited (EBL) as the bank will take a SOFR-based trade loan from Wells Fargo Bank.
Under the deal, Wells Fargo, Singapore has extended a trade loan facility for 180 days to EBL where SOFR has been taken as the USD benchmark rate instead of LIBOR.
The Secured Overnight Financing Rate (SOFR) is a broad measure of the cost of borrowing cash overnight collateralized by Treasury securities.
The SOFR is calculated as a volume-weighted median of transaction-level tri-party repo data, GCF Repo transaction data, and data on bilateral Treasury repo transactions.
Deputy Managing Director and Head of Treasury, FI and Offshore banking of EBL Mehdi Zaman and Managing Director and Head CIB –FIG, APAC South, Wells Fargo Bank Santanu Sengupta delivered their valuable speech.
Source: The Financial Express