US derivatives exchange ICE has launched a beta version of its GBP ICE Swap Rate for SONIA swaps through its ICE Benchmark Administration (IBA) business.
ICE said that IBA has started publishing the beta version of the ICE Swap Rate for SONIA swaps following market feedback and consultation papers.
IBA will publish daily indicative GBP SONIA ICE Swap Rate beta settings with tenors ranging from one to 30 years to allow users to evaluate the rates and submit further feedback.
The GBP SONIA ICE Swap Rate ‘Beta’ version is determined by using the published ICE Swap Rate ‘waterfall’ methodology and is available for the same tenors and at the same time as the current GBP Libor ICE Swap Rate.
“We are pleased to support the development and adoption of alternative rates by launching ICE Swap Rate settings for SONIA”, said president of ICE Benchmark Administration, Tim Bowler.
“IBA is working hard to provide products and solutions to help stakeholders transition efficiently to alternative rates. We expect to be able to launch ICE Swap Rate settings for other alternative, overnight rates as the relevant swaps markets develop.”
SONIA is an alternative benchmark for UK sterling derivatives as Libor is gradually phased out. It is considered best practice as an alternative reference rate, following years of controversy and manipulation shrouding the Libor benchmark.
In July, ICE launched the initial beta version of its ICE term SONIA reference rates (ICE TSRR), which measure average expected SONIA rates over one month, three months, and six-month tenor periods on a daily basis.