LIBOR

LIBOR (the London Interbank Offered Rate) was, for decades, the benchmark interest rate banks charged each other for short-term loans, and it underpinned trillions of dollars of mortgages, corporate loans, and derivatives worldwide. It was phased out after a rate-rigging scandal exposed that some banks had been submitting false rates to benefit their own trading positions.

LIBOR was formally retired for new contracts by mid-2023 and replaced in the US primarily by SOFR. Older contracts still referencing LIBOR remain relevant to understand for anyone reading legacy loan or bond documentation.