Post-Libor Transition, There Remain Refinements to Be Made and Risks to Be Aware of
In a report last November, the Alternative Reference Rates Committee declared success as it closed the book on supplanting the Libor benchmark in the U.S. with the Secured Overnight Financing Rate (SOFR). But it did not say that all work is complete. ARRC’s website remained open though deactivated, as the committee said that its closing report highlighted “key […]
A New Market in Unsecured Interbank Funding Steps Up
Euromoney: A new market in unsecured interbank funding steps up See below for excerpts from a recent Euromoney feature. For the full article, see here. The AFX marketplace provides a new venue for US regional and community banks to lend and borrow from each other overnight. It could be the foundation for a new credit-sensitive […]
John Shay Shoulders AFX Role With Optimism and Purpose
AFX CEO John Shay recently spoke with John Lothian from John Lothian News (https://johnlothiannews.com/) in the following video interview: John Shay, the CEO of the American Financial Exchange, took on the role after 7RIDGE bought the exchange from AFX Founder and former CEO Dr. Richard Sandor and the other AFX investors. He was interviewed over […]
In the Wake of Libor, New AFX Leadership Turns Attention to Growth
The formal cessation of the Libor benchmark at the end of June was long anticipated by, among others, the American Financial Exchange (AFX), the platform on which funding transactions among its mostly regional-bank membership set the Ameribor rate. Ameribor is designed to be credit-sensitive like Libor while better reflecting banks’ funding costs than does the Secured Overnight […]
UK regulator makes ‘final call’ to switch off Libor
LONDON, May 31 (Reuters) – Markets participants have a month to stop using Libor, the tarnished interest rate banks were fined for trying to rig, Britain’s Financial Conduct Authority (FCA) said on Wednesday. The London Interbank Offered Rate (Libor) reflected the cost of lending between banks, using quotes from panels of banks in 35 variants […]
AMERIBOR Creator AFX Bought by 7RIDGE as LIBOR’s End Draws Near
The American Financial Exchange, a Chicago-based marketplace that allows small banks to borrow from each other, has been acquired. The exchange, launched eight years ago by Chicago futures pioneer Richard Sandor and the Chicago Board Options Exchange, was bought by private-equity firm 7Ridge for an undisclosed price.
How the LIBOR Transition Affects the Supply of Revolving Credit
In the United States, most commercial and industrial (C&I) lending takes the form of revolving lines of credit, known as revolvers or credit lines. For decades, like other U.S. C&I loans, credit lines were typically indexed to the London Interbank Offered Rate (LIBOR). However, since 2022, the U.S. and other developed-market economies have transitioned from […]