A second term SOFR: help or hindrance?
Ice launches CME rival as fallback for loans but market ambivalence may put endorsement out of reach
Like buses, regulator-endorsed term SOFR took ages to arrive – and now there are two of them.
Ice Benchmark Administration launched its term version of the secured overnight financing rate in March, citing market need for a back-up to CME’s term SOFR. But some say the CME’s rate, which is referenced by most cash instruments and – critically – is regulator-endorsed, already covers market requirements.
IBA president Tim Bowler nonetheless argues the need for a second option.
“One of the things
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