Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Nyse  >  Intercontinental Exchange Inc    ICE

INTERCONTINENTAL EXCHANGE INC (ICE)
My previous session
Most popular
  Report  
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsofficial PublicationsSector newsTweets

Intercontinental Exchange : UK watchdog tells banks to show plans for ending Libor use

share with twitter share with LinkedIn share with facebook
share via e-mail
0
07/12/2018 | 03:01pm CEST
FILE PHOTO: Andrew Bailey, CEO of the Financial Conduct Authority, speaks during a

LONDON (Reuters) - Banks must show how they plan to shift from using Libor in financial contracts to "risk-free" interest rate benchmarks by the end of 2021, Britain's markets watchdog said on Thursday.

Banks have been fined $9 billion for trying to rig Libor, a measure of borrowing costs among lenders, and the Bank of England (BoE) has launched a supposedly risk-free alternative, its SONIA overnight rate, for use in contracts.

Risk-free rates are considered harder to manipulate as they are based on actual market transactions, as opposed to quotes submitted by "panel" banks to compile Libor.

But switching long-term contracts to SONIA is proving difficult in some cases, as Libor rates can stretch out several years rather than just overnight to price trillions of dollars in contracts globally from home loans to credit cards.

"The absence of ways to remedy the current underlying weakness in Libor – the lack of transactions, the unattractive prospect of Libor limping on with fewer panel banks, and the significant problems associated with a synthetic Libor, all lead to the same conclusion," Financial Conduct Authority (FCA) Chief Executive Andrew Bailey said.

"The best option is actively to transition to alternative benchmarks. The most effective way to avoid Libor-related risk is not to write Libor-referencing business," Bailey said in a speech at Bloomberg in London.

Gerard Jacob, a partner at management consultancy Parker Fitzgerald, said it was the strongest message yet that firms must initiate transition programmes, backed by hints that regulators may not even allow the use of Libor after 2021.

Bailey set the end-2021 deadline for transition in a speech a year ago, but market participants have continued to accumulate Libor-linked sterling derivatives for periods well after 2021.

About $170 trillion of the interest rate swap contracts cleared by LCH, a London-based clearing house, reference Libor, and a little under one-third of these mature after the end of 2021, Bailey said.

In an effort to get banks to speed up migration to SONIA, he said financial firms in Britain will have to show the FCA and the BoE how they will reduce their dependency on Libor.

"Andrew Bailey has given his clearest signal yet to the market that the bell tolls for Libor," said Mairead Duncan-Jones, capital markets lawyer at Linklaters.

"After this morning’s speech the 'wait and see' approach is not likely to be sufficient," Duncan-Jones said.

Bailey said that in most cases the best solution was to use overnight rates rather than continue using Libor or an alternative rate compiled like Libor.

There are also "formidable" difficulties in creating a "synthetic" Libor that combines a risk-free rate and credit spreads, he added.

"It should be clear to current Libor users that they must not rest any hopes in a synthetic solution to continuing Libor publication."

(This story Amends reference to Parker Fitzgerald in paragraph seven)

(Reporting by Huw Jones; editing by Jason Neely, Mark Potter and Keith Weir)

By Huw Jones

Stocks mentioned in the article
ChangeLast1st jan.
INTERCONTINENTAL EXCHANGE INC 0.73% 73.5 Delayed Quote.4.17%
LONDON STOCK EXCHANGE 0.14% 4443 Delayed Quote.17.01%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on INTERCONTINENTAL EXCHANGE
08/14INTERCONTINENTAL EXCHANGE : Nasdaq, FINRA to boost reporting fees for dark pool ..
RE
08/13INTERCONTINENTAL EXCHANGE, INC. : Other Events, Financial Statements and Exhibit..
AQ
08/09INTERCONTINENTAL EXCHANGE, INC. : Entry into a Material Definitive Agreement, Fi..
AQ
08/04NYSE Owner Putting Muscle Behind Bitcoin -- WSJ
DJ
08/03INTERCONTINENTAL EXCHANGE, INC. : Other Events (form 8-K)
AQ
08/03NYSE's Owner Launches Bitcoin Firm, Futures Contracts
DJ
08/03Euronext CEO says sniffing for deals, but on a budget
RE
08/02INTERCONTINENTAL EXCHANGE : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CO..
AQ
08/02INTERCONTINENTAL EXCHANGE, INC. : Results of Operations and Financial Condition,..
AQ
08/02INTERCONTINENTAL EXCHANGE INC : Intercontinental Exchange, Inc. to Host Earnings..
AC
More news
News from SeekingAlpha
08/13The latest portfolio moves by Third Point 
08/12Tracking Dan Loeb's Third Point Portfolio - Q2 2018 Update 
08/11Bitcoin Is A Beautiful Mess 
08/08Tracking William Von Mueffling's Cantillon Capital Management Portfolio - Q2 .. 
08/06ICE : A Buying Opportunity 
Financials ($)
Sales 2018 4 924 M
EBIT 2018 2 807 M
Net income 2018 1 789 M
Debt 2018 4 724 M
Yield 2018 1,30%
P/E ratio 2018 23,58
P/E ratio 2019 20,80
EV / Sales 2018 9,46x
EV / Sales 2019 8,83x
Capitalization 41 844 M
Chart INTERCONTINENTAL EXCHANGE INC
Duration : Period :
Intercontinental Exchange Inc Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends INTERCONTINENTAL EXCHANGE
Short TermMid-TermLong Term
TrendsBearishNeutralBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 16
Average target price 82,9 $
Spread / Average Target 13%
EPS Revisions
Managers
NameTitle
Jeffrey Craig Sprecher Chairman & Chief Executive Officer
Benjamin R. Jackson President
Mark P. Wassersug Chief Operating Officer
Scott Anthony Hill Chief Financial Officer
Mayur Kapani Chief Technology Officer
Sector and Competitors
1st jan.Capitalization (M$)
INTERCONTINENTAL EXCHANGE INC4.17%41 844
CME GROUP13.87%55 827
HONG KONG EXCHANGES AND CLEARING LIMITED-7.28%36 149
INTERACTIVE BROKERS GROUP, INC.4.37%25 758
DEUTSCHE BOERSE16.79%24 617
LONDON STOCK EXCHANGE17.01%19 900