Intercontinental Exchange, Inc. (NYSE: ICE) disclosed that that ICE Benchmark Administration Limited (IBA) has shared an update regarding LIBOR cessation and "synthetic" LIBOR after the earlier announcements from the UK Financial Conduct Authority (FCA). IBA licensed and controlled by FCA for the regulated activity of managing a benchmark. It is approved as a benchmark administrator under the UK Benchmarks Regulation.
FCA declared on March 5, 2021, that all Swiss franc and euro LIBOR settings, the 1 Week and 2 Month U.S. dollar LIBOR settings, and the Overnight/Spot Next, 1 Week, 2-Month, and 12-Month sterling and Japanese yen LIBOR settings will halt immediately after December 31, 2021. FCA has also announced that the Overnight and 12-Month U.S. dollar LIBOR settings will halt instantly after June 30, 2023.
Furthermore, FCA revealed on September 29, 2021, that after a discussion, that to guarantee a methodical removal of the 1-, 3- and 6-Month sterling and Japanese yen LIBOR settings it will force IBA to issue these six LIBOR settings under a change, "synthetic" methodology for 2022.
In addition, FCA informed IBA that it has selected these six LIBOR settings as "Article 23A benchmarks" for the objectives of the BMR with effect from January 1, 2022, which it must do to allow it to require these changes. The FCA also stated that the first non-representative publication of these six "synthetic" LIBOR settings under the changed, unrepresentative, "synthetic" methodology will be on January 4, 2022.