Goldman Sachs Supports IHS Markit’s Service for Libor Replacement

Goldman Sachs is among seven major dealers to support IHS Markit’s trade processing service for OTC derivatives as the Libor benchmark is phased out. IHS Markit said that the first wave of OTC derivatives trades using the Libor replacement, Secured Overnight Financing Rate (SOFR), deployed MarkitSERV to match, confirm and straight-through process transactions for clearing and regulatory reporting. According to a story in The Trade, seven major derivatives dealers, including Goldman Sachs, have completed SOFR trades with MarkitSERV, for both cleared and non-cleared, as well as party-to-party direct and swap execution facility (SEF) trades. MarkitSERV currently supports several reference rates including SOFR, SARON for Swiss Francs, SONIA for British Pounds, and TONA for Japanese Yen. SOFR was introduced earlier this year as an alternative benchmark to Libor for US dollar derivatives and other financial products. It was first published by the New York Federal Reserve Bank in April and is now considered best practice following years of controversy and manipulation shrouding the Libor benchmark.