Jurisdiction(s):
United Kingdom

Drafting with term risk-free rates in loan agreements: Term SOFR, Term SONIA, Term €STR, EURIBOR fallbacks, LMA forms and post‑LIBOR case law

Published by a LexisNexis Banking & Finance expert

Practice notes

This Practice Note examines the application of term risk‑free rates (RFRs) in loan agreements. It addresses:

what term RFRs exist and when they are appropriate
Term Secured Overnight Financing Rate (Term SOFR) and the Loan Market Association (LMA) Facilities Agreements
EURIBOR and Term €STR
key considerations when deploying Term Sterling Overnight Index Average (Term SONIA)

For:

guidance on using compounded RFRs in loan agreements, see Practice Note: Interest provisions in risk‑free rate based loan agreements
background on interest in a facilities agreement and the types of rates available, see Practice Note: Introductory guide to interest in loan agreements
our material in an easy‑to‑navigate interactive toolkit, see: toolkit
an overview of the key issues in the LIBOR transition, see Practice Note: Introductory guide to LIBOR transition
a list of developments for each LIBOR currency during the transition, see the: LIBOR developments tracker

What term RFRs are available and when can they be used?

The principal scenarios in which borrowers and lenders may opt for term RFRs are:

in new transactions
when amending an existing transaction to be based...

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Web page updated on 21/05/2026

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