LONDON, Dec 16 (IFR) - ISDA has appointed ICE Benchmark
Administration to the newly created role of secretary for the
five regional credit derivatives determinations committees.
The appointment follows a tender process that launched in
May. It is part of a wider attempt to strengthen the
independence of a body that ultimately determines whether
entities have defaulted on their liabilities and whether credit
default swaps should pay out.
In its new role, IBA will be responsible for administrative
duties including passing questions submitted by participants to
the relevant regional determination committees, coordinating
meetings, organising and compiling votes of DC members and
"The ISDA selection committee felt IBA has the necessary
skills and expertise to support and develop the DC process and
help ensure the long-term viability of the credit derivatives
market," said Scott O'Malia, ISDA's chief executive. "We will
work closely with IBA in the coming months to ensure a smooth
and orderly transition of the DC secretary responsibilities."
The transition of administrative duties is expected to take
around six months and will see IBA develop a new DC website. New
infrastructure will also be introduced to ensure a robust and
transparent process that meet evolving regulatory standards.
IBA will not have a voting role on the committees, each of
which comprise 10 sellside and five buyside members.
ISDA will continue to write DC rules and the credit
definitions that drive the decision making process. Earlier this
year, the DCs voted to make a series of changes to DC rules,
including the requirement for voting firms to confirm they have
written policies in place for identifying and managing conflicts
IBA, a subsidiary of the InterContinental Exchange, was
created in 2013. The unit won a tender to take over the
administration of Libor in 2014 and is now responsible for a
range of financial benchmarks including LBMA gold and the ICE
swap rate (formerly ISDA Fix).
As part of a drive to enhance transparency and effectiveness
across economic indicators, IBA embarked on a reform process
that aligns with IOSCO benchmark principles. The firm has
established oversight committees for each benchmark, appointing
independent experts and has shifted calculation methodology from
polled submission models to real, tradable quotes on regulated
(Reporting by Helen Bartholomew)