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Finbarr Hutcheson, ICE

ICE Benchmark Administration to become administrator for LBMA Silver Price


Intercontinental Exchange ICE Benchmark Administration (IBA) has been chosen as the new administrator of the London Bullion Market Association (LBMA Silver Price). IBA expects to assume responsibility for the LBMA Silver Price in Autumn 2017.

“We are pleased to become the administrator for the LBMA Silver Price,” says Finbarr Hutcheson (pictured), President, IBA. “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. 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.”
 
Ruth Crowell, Chief Executive of the LBMA, says: “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.”
 
IBA will take over as administrator of the LBMA Silver Price from CME Group and Thomson Reuters later this year. In March 2015, IBA successfully transitioned the former London Gold Fix from a conference call based methodology to the independently administered, transparent and electronic auction process which now underlies the LBMA Gold Price. IBA runs daily surveillance on the auction activity and also runs a quarterly Oversight Committee with broad representation from the market. The auction runs on ICE’s trading platform, which provides straight through processing (STP) for many firms and a full audit trail for compliance departments.
 
In April, IBA introduced central clearing to the LBMA Gold Price auction enabling a wider range of participants to join the auction. Firms may elect their preferences for cleared or bilateral trading in the auction. Since the introduction, over 4 million ounces of gold have cleared through ICE, the equivalent of nearly USD5 billion. Volume that is cleared has increased from 30 per cent at launch to 72 per cent for the week ending 7 July, 2017.

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