ICICI Bank has executed its first interbank - money market transaction linked with Secured Overnight Funding Rate (SOFR). The transaction, executed through the Bank’s Hong Kong branch, is part of the Bank’s Benchmark Transition Management plan to assess the preparedness towards a smooth transition to the new Alternative Reference Rates (ARRs).
SOFR has been identified as the replacement for USD LIBOR (London Interbank Offered Rate). Globally, there is a move to migrate from LIBOR to transactions linked to ARRs and it is expected that fresh transactions after December 2021 would not be referenced to LIBOR.
ICICI Bank is a leading private sector bank in India.