Case Study: SOFR Academy achieves IOSCO-compliant benchmark transparency and reliability with IBM Promontory

SOFR Academy uses IBM Promontory to achieve financial compliance and design-based reliability

SOFR Academy needed a credible, post-LIBOR solution for credit-sensitive benchmark rates and turned to IBM Promontory for an independent review of its Across-the-Curve Credit Spread Index (AXI) and Financial Conditions Credit Spread Index (FXI). The challenge was to ensure the benchmarks met IOSCO principles for design, data sufficiency, and transparency so they could gain market trust and regulatory acceptance.

IBM Promontory assessed the benchmark methodology and recommended improvements including clearer fallback rules, more transparent calculation details, defined volume thresholds, a market-monitoring framework, and ongoing annual reviews. As a result, SOFR Academy strengthened AXI and FXI’s reliability and transparency, and IBM Promontory concluded they fully implemented IOSCO Principles 6, 7, and 9, supporting broader confidence and adoption in the market.

SOFR Academy

Alex Roever

Senior Advisor