LBMA to Hand Over Silver Pricing Administrative Responsibility to ICE

The IBA will take over as administrator of the LBMA Silver Price from CME Group and Thomson Reuters in Q3

On the heels of its past success with its Gold Price auction, London Bullion Market Association (LBMA) has tasked a familiar group with handling its silver pricing. As such, Intercontinental Exchange’s (NYSE:ICE) Benchmark Administration has been selected to be the newest administrator for the LBMA Silver Price.

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LBMA will be handing over responsibility of its Silver Pricing auctions to the ICE Benchmark Administration (IBA) by as early Q3 2017. As LBMA’s newest administrator, the IBA will look to undergo a smooth transition, displacing both CME Group and Thomson Reuters who both handle such operations presently.

LMBA’s decision is its latest effort to shore up any operational issues and challenges with a relatively newly adopted electronic benchmark. Previously, the London silver fix was run using a primarily telephone-based auction or other dated measures that have since been abandoned for newer techniques – these new measures however have experienced their fair share of growing pains such as big market swings from the underlying prices and other discontinuities.

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Ongoing partnership

The shifting administration of its Silver Pricing will also aim to help expand participation in the precious metal – the IBA has previously managed the LBMA Gold Price auction and other important benchmarks successfully, which played a key role in the association’s decision to lean on them for their latest ambitions.

The IBA presently underlies the LBMA Gold Price, also conducting a multitude of surveillance measures on auction activity. Since 2015, the IBA has also run a quarterly oversight committee, helping represent broad components of the market. Presently, the auction is integrated and run on ICE’s comprehensive trading platform.

Finbarr Hutcheson, President, IBA, commented: “We are pleased to become the administrator for the LBMA Silver Price. The decision by the LBMA membership reflects our commitment and investment in making the LBMA Gold Price IOSCO compliant over the last two years. Our centrally cleared model has already enabled broader participation and we continue to expand the gold auction.”

Ruth Crowell

“We anticipate this will support expanded participation in silver as well. We are excited to build on our work with the LBMA to ensure strong governance and the evolution of these important benchmarks,” he added.

“This is excellent news, and important for the stability of the silver market that a new administrator is seamlessly transitioned with minimal disruption to the market. I believe these goals will be achieved with IBA as the new administrators, particularly since they bring with them the experience of successfully managing the LBMA Gold Price auction and other important benchmarks,” reiterated Ruth Crowell, Chief Executive of the LBMA.

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