LIBOR Transition Could Impact Your Credit Card Interest Rate
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Paul Noring discussed the phasing out of the LIBOR index and commented that AMERIBOR (a new interest rate benchmark created by the American Financial Exchange) is an alternative that is gaining more traction, has a credit spread, and is based on real transactions with sufficient depth.
Mr. Noring also discussed how cardholders will be less impacted by this change than the banks that provide the credit; and how the “margin added to the LIBOR index, or the spread, for credit card debt is huge, whereas the markups on the other forms of consumer credit are ‘much less.’”
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