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Industry Participants Now Able to Utilize IHS Markit
Benchmarks in Creation of Non-retail Financial
Products
IHS Markit, a world leader in critical information, analytics
and solutions, today announced its series of forward-looking
dynamic term benchmarks that measure the daily US Dollar (USD) cost
of funding in institutional markets are now able to be utilized to
create non-retail financial products. These benchmarks include the
IHS Markit USD Credit Inclusive Term Rate (CRITR) and the IHS
Markit USD Credit Inclusive Term Spread (CRITS), which are designed
to provide banking institutions a broad measure of USD funding
costs on a senior unsecured basis.
The publication of the CRITR and CRITS benchmarks started on 1
June 2021, including 5 years of historical data. IHS Markit is now
allowing industry participants to use these benchmarks in the
creation of non-retail financial products. The rates will continue
to be updated daily at 8am ET, in alignment with SIFMA's holiday
calendar. The benchmarks are available in the following tenors:
overnight, 1-month, 3-month, 6-month, and 12-months.
CRITR and CRITS are the first credit sensitive benchmarks based
on extensive constituent bases - they track most USD institutional
certificates of deposit, commercial paper and short-term corporate
bond transactions using a publicly disclosed, robust rules-based
methodology and compliance framework. The methodology was developed
and refined by working closely with market and industry
participants. The CRITS benchmark does not impede the adoption of
the rate recommended by the Alternative Reference Rates Committee
(ARRC) and addresses concerns of market participants who want to
use SOFR but need a credit sensitive component.
"The market requires a straightforward and robust solution for
firms transitioning their exposure before USD LIBOR publications
cease on 30 June 2023," said Julien Rey,
executive director and head of the LIBOR transition program, IHS
Markit. "The IHS Markit USD CRITR and CRITS benchmarks, created
through an extensive development process, offer a series of dynamic
rates that measure U.S. Dollar cost of funding in institutional
markets, enabling institutions to create non-retail financial
products indexed to a rate or a spread adjustment compliant with
the UK Benchmark Regulation and the IOSCO Principles for Financial
Benchmarks."
The benchmarks are administered by IHS Markit Benchmark
Administration Ltd. (IMBA UK) in compliance with the UK Benchmark
Regulation and the IOSCO Principles for Financial Benchmarks.
For more information on IBOR Transition offerings from IHS
Markit click
here.
Posted 02 February 2022 by Julien Rey, Executive Director, Financial Services, Head of LIBOR Transition Program, S&P Global Market Intelligence
IHS Markit provides industry-leading data, software and technology platforms and managed services to tackle some of the most difficult challenges in financial markets. We help our customers better understand complicated markets, reduce risk, operate more efficiently and comply with financial regulation.
