IHS Markit (Nasdaq: INFO), a provider of critical information, analytics and solutions on financial markets has announced today that is has been approved by the Financial Conduct Authority (FCA) as an authorized benchmark administrator under the European Benchmark Regulation (BMR).
With the authorization, market participants can continue to reference the range of IHS Markit’s financial and commodity indices under the European Union’s (EU) BMR. It also allows clients of the benchmark to retain ownership of their indices.
IHS Markit offers traders a range of proprietary benchmarks and tradable indices across assets, including iBoxx bond indices, OPIS refined oil product indices, iTraxx and CDX indices for credit default swaps and IHS McCloskey Coal indices used in commodity markets.
EU Benchmark Regulation
BMR aims to bring greater transparency and consistency to financial benchmarks and combat risks to their susceptibility to manipulation. The majority of the provisions came into effect on January 1 this year, and it builds upon the IOSCO Principles for Financial Benchmarks, which were published in July 2013. The regulation will be completely implemented in 2020 when the transitional period ends.
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Commenting on the development, Mark Schaedel, the managing director and head of Index Administration Services at IHS Markit said: “IHS Markit has invested a significant amount of resources in BMR compliance, and when appointed as an independent benchmark administrator, we can provide a compliance alternative to clients, which allows them to retain ownership of their indices, and avoid inherent conflicts of interest.
“In addition, as an independent administrator, IHS Markit can provide endorsement for non-European indices which require access to the EU market.”
Aram Flores, managing director and global co-head of financial indices at IHS Markit also added: “across our indices franchise, we strongly support the objectives of BMR in promoting the integrity and transparency of benchmark indices.
“Financial institutions rely upon IHS Markit indices as the gold standard for market indicators, and as we continue to expand our leadership in this space, we will continue to deliver innovation and excellence.”