Ivory Consulting, a provider of equipment lease and loan software, software customizations and consulting services for the equipment finance industry, is supporting the transition of lessors from LIBOR to another interest rate by making appropriate customizations to its SuperTRUMP product.

With the need to replace LIBOR by the end of 2021, financing institutions must develop a clear internal program to meet the timelines provided by the Alternative Reference Committee.

Converting from LIBOR to another interest rate such as SOFR or BSBY can lead to changes in how lessors price and analyze their transactions, whether using SuperTRUMP or a different lease and loan modeling and pricing application. Using SuperTRUMP, it is possible to switch between different interest rates and to lock one or both rates when modeling a proposed transaction. For example, lessors can use SuperTRUMP to review a deal priced using LIBOR and a new rate, essentially creating a “before and after” look. As with LIBOR, a feed from corporate treasury of other interest rates can be incorporated into SuperTRUMP.

“Upon moving to SOFR, BSBY or another rate, lessors may need to reprice contracts originally priced and booked using LIBOR, which can be challenging due to the different term structures of these rates,” Edmund Wong, director of sales operations at Ivory Consulting, said. “Ivory Consulting is ready to help our SuperTRUMP users and other equipment lessors tackle this transition.”