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ICE Benchmark Administration Provides Update on its Intention to Launch USD SOFR Spread-Adjusted ICE Swap Rate® as a Benchmark
Rhea-AI Impact
(Low)
Rhea-AI Sentiment
(Neutral)
Tags
Rhea-AI Summary
Intercontinental Exchange (NYSE:ICE) announced the launch of the U.S. dollar (USD) SOFR Spread-Adjusted ICE Swap Rate, set to operate from June 30, 2023. This new benchmark will replace the USD LIBOR ICE Swap Rate, which will cease publication on the same date. The SOFR-based rates are currently available in a beta format for testing and align with the Alternative Reference Rates Committee's guidelines. Following market feedback, the launch date has been advanced from July 3, 2023 to June 30, 2023. These benchmarks will assist financial institutions in transitioning away from LIBOR, ensuring compliance with new regulatory frameworks.
Positive
Launch of USD SOFR Spread-Adjusted ICE Swap Rate on June 30, 2023.
Transition from USD LIBOR ICE Swap Rate to a more compliant SOFR benchmark.
Market feedback led to an expedited launch, indicating strong demand.
Negative
None.
LONDON--(BUSINESS WIRE)--
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of data, technology, and market infrastructure, today announced that ICE Benchmark Administration Limited (IBA) plans to launch U.S. dollar (USD) SOFR Spread-Adjusted ICE Swap Rate® for use as a benchmark in financial contracts and financial instruments by licensees on June 30, 2023.
USD SOFR Spread-Adjusted ICE Swap Rate® settings are currently published in an indicative, ‘beta’ format for testing purposes, and are determined in line with the methodology suggested by the Alternative Reference Rates Committee (ARRC) in its paper “Suggested Fallback Formula for the USD LIBOR ICE Swap Rate”.
As previously announced, IBA will cease the publication of all USD LIBOR ICE Swap Rate settings immediately following publication on June 30, 2023.
Following market feedback, IBA is planning to bring forward the launch of USD SOFR Spread-Adjusted ICE Swap Rate settings for use as a benchmark from July 3, 2023, to June 30, 2023.
The USD SOFR Spread-Adjusted ICE Swap Rate settings may be used under certain ISDA documentation designed to implement fallbacks for USD LIBOR ICE Swap Rate as suggested by the ARRC paper. Guidance from ISDA regarding this documentation and how it operates is available here.
About ICE Benchmark Administration
ICE Benchmark Administrationis authorized and regulated by the Financial Conduct Authority for the regulated activity of administering a benchmark, and is authorized as a benchmark administrator under the UK Benchmarks Regulation. IBA reserves all rights in the ICE Swap Rate methodology and the ICE Swap Rate settings, including USD LIBOR ICE Swap Rate, USD SOFR ICE Swap Rate and USD SOFR Spread-Adjusted ICE Swap Rate settings. ICE, LIBOR, ICE Swap Rate and ICE Benchmark Administration are registered trademarks of IBA and/or its affiliates. IBA is not affiliated with the New York Fed. The New York Fed does not sanction, endorse, or recommend any products or services offered by IBA.
About Intercontinental Exchange
Intercontinental Exchange, Inc.(NYSE: ICE) is a Fortune 500 company that designs, builds and operates digital networks to connect people to opportunity. We provide financial technology and data services across major asset classes that offer our customers access to mission-critical workflow tools that increase transparency and operational efficiencies. We operate exchanges, including the New York Stock Exchange, and clearing houses that help people invest, raise capital and manage risk across multiple asset classes. Our comprehensive fixed income data services and execution capabilities provide information, analytics and platforms that help our customers capitalize on opportunities and operate more efficiently. At ICE Mortgage Technology, we are transforming and digitizing the U.S. residential mortgage process, from consumer engagement through loan registration. Together, we transform, streamline and automate industries to connect our customers to opportunity.
Trademarks of ICE and/or its affiliates include Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information regarding additional trademarks and intellectual property rights of Intercontinental Exchange, Inc. and/or its affiliates is located here. Key Information Documents for certain products covered by the EU Packaged Retail and Insurance-based Investment Products Regulation can be accessed on the relevant exchange website under the heading “Key Information Documents (KIDS).”
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 -- Statements in this press release regarding ICE's business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see ICE's Securities and Exchange Commission (SEC) filings, including, but not limited to, the risk factors in ICE's Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on February 2, 2023.
