- IntercontinentalExchange (ICE +0.7%) took over administering Libor this year and on July 1 introduced licensing agreements, including a usage license ranging from $8K-$40K per year. Previously, Libor was free except for companies wanting to redistribute the rates.
- “There’ve been a number of banks saying they may stop using Libor,” says teh ABA's Denyette DePierro. “Everybody’s kind of waiting to see what ICE is going to do, and, from a cost-benefit perspective, do you continue with Libor or not?”
- The new fees could affect many of the nearly 7K banks and 800 firms managing registered investment funds in the U.S., but banks which contribute Libor rates to ICE - including JPMorgan, Bank of America, and Barclays - won't be charged.
- The Mortgage Bankers Association has let its concerns be heard, and ICE - while calling the fees "modest" says it's listening to a point. "There has been a lot of criticism by people that they wanted Libor to be better, but then when they’re asked to pay for it, they’re surprised. It shouldn’t be a surprise," says ICE chief Jeff Sprecher.
As ICE adds fees, banks mull dropping Libor
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