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Member Bulletin

  • December 02, 2022
  • Bulletin No: 2022-28

Requirement of Adequate Fallback Language for LIBOR-Indexed Collateral

On February 2, 2022, the Federal Home Loan Bank of Dallas (Bank) issued Member Bulletin No. 2022-04 (Bulletin) to address the LIBOR transition and the Bank’s requirements related to members’ LIBOR-indexed loan and securities collateral. Specifically, the Bulletin described the Bank’s requirement that all LIBOR-indexed loan and securities collateral maturing after June 30, 2023 contain adequate fallback language to allow for substitution of an appropriate index to replace LIBOR. 

On March 15, 2022, President Joe Biden signed into law the Adjustable Interest Rate (LIBOR) Act to provide a uniform solution for contracts indexed to LIBOR for which there is no adequate fallback language. The LIBOR Act addresses the Bank’s previous concern by ensuring adequate fallback language for members’ LIBOR-indexed collateral. As such, the Bank will not include a review of fallback language in the Bank’s 2023 Collateral Verifications as previously announced in the Bulletin.

For questions, please contact the Bank’s Collateral Services department at or 800.541.0597.


Michael Zheng
EVP, Chief Credit Officer