In 2020, Ginnie Mae adopted recommendations of the Alternative Reference Rates Committee (ARRC) for fallback language for all LIBOR floating rate multiclass securities to address the pending cessation of LIBOR.1
The purpose of this Multiclass Participants Memorandum (MPM) is to inform interested participants in the Multiclass Securities Program that, in accordance with the previously adopted ARRC fallback language and the Adjustable Interest Rate (LIBOR) Act (LIBOR Act) passed by Congress in March 2022 (together with the regulations of the Federal Reserve Board of Governors promulgated thereunder), Ginnie Mae has selected CME Term SOFR as the reference rate for all LIBOR Classes outstanding after June 30, 2023.
All tenors of LIBOR for all LIBOR Classes will be replaced with the corresponding tenor of CME Term SOFR for calculations of the interest amount payable for all interest periods with determination dates occurring after June 30, 2023. The replacement rate and the calculation of the interest amount payable on such LIBOR Classes, for interest periods with determination dates occurring after June 30, 2023, will include the applicable tenor spread adjustment of 0.11448% per annum, 0.26161% per annum or 0.71513% per annum in the case of LIBOR Classes that reference one-month LIBOR, three-month LIBOR or twelve-month LIBOR, respectively, as specified in the LIBOR Act.
Any minimum or maximum interest rate applicable to any LIBOR Class will remain the same. Corresponding changes to any related pooling REMIC subaccounts will also be made.
For all capitalized but not defined terms used herein, refer to Ginnie Mae’s Multiclass Securities Guide currently in effect, as amended by previous Multiclass Participants Memoranda.
This MPM shall serve as notice to all applicable trustees of Ginnie Mae’s selection.
The Ginnie Mae Multiclass Securities Guide, including the Base Offering Circulars, can be found on the Ginnie Mae Website:
Please call Ginnie Mae’s Office of Capital Markets at (202) 475-7820 with any questions or comments regarding this announcement.