American Financial Exchange, LLC

AFX was recently featured in a Traders Magazine article highlighting our new whitepaper, "AMERIBOR: A Better Credit Sensitive Reference Rate", produced in coordination with University of Massachusetts Amherst’s Marco Macchiavelli. The whitepaper, which examines reference rate options following the cessation of LIBOR in July 2023, outlines the benefits of credit-sensitive rates. ? Read the full article for more on how AMERIBOR's advanced cyclical properties compare to other alternative overnight rates: https://lnkd.in/esv3cp9k

AFX CEO John Shay recently appeared on the "At the Forefront" podcast alongside Professor Marco Macchiavelli to discuss how credit-sensitive rates like our AMERIBOR benchmark provide regional and commercial banks with stability and security in the post-LIBOR era – especially during times of market volatility.? ? Tune in to the full episode below for more insights

Today, we announced the publication of new research in coordination with University of Massachusetts Amherst's?Marco Macchiavelli, Assistant Professor of Finance with the Isenberg School of Management, UMass Amherst and former Principal Economist at the Federal Reserve.?The whitepaper examines reference rate options following the cessation of LIBOR in July 2023. Macchiavelli’s research indicates that access to CSRs is important for smaller financial institutions across the U.S., especially during times of market stress. AFX CEO John Shay, commented: “The research conducted by Professor Macchiavelli underscores the need for a credit-sensitive rate. Community and regional banks are the backbone of America’s financial system. At AFX, we are proud to continue offering the AMERIBOR rate to best serve our 250 member across the country.” Read the full press release here:?https://lnkd.in/etNSMAqH

TABB Group recently featured AFX CEO John Shay’s op-ed, “A Rate for Main Street: Why Commercial Banks Urgently Need Credit-Sensitive Benchmark Interest Rates.” In the piece, he makes the case for why credit-sensitive benchmark interest rates are a safer standard for commercial banks in the post-LIBOR era. Read more here: https://lnkd.in/dxS3_mzt

In the post-LIBOR era, America’s regional and local banks urgently require a new, credit-sensitive benchmark interest rate, based on real transactions and in alignment with the unique needs of their businesses. In this new op-ed, AFX CEO John Shay breaks down how a credit-sensitive benchmark interest rate can benefit commercial banks during times of market stress. Read on to hear our case for how alternative benchmark interest rates like AMERIBOR can create a more stable, efficient lending landscape and a more resilient banking system. https://lnkd.in/eU-WjTMT ?

AFX CEO John Shay was recently interviewed by Radi Khasawneh, Derivatives Editor at FOW for a piece looking at the impact of the August selloff and the importance of credit sensitive rates, especially during times of volatility. ? “We are the only fully electronic, resilient and tested marketplace out there. We are determined to stick to our home cooking – which is growing membership, traded volumes and raising awareness as to the importance of a credit sensitive rate.” – John Shay, CEO of AFX ? Read more here: https://lnkd.in/e2txGHSz

Exactly one year ago today, IOSCO announced its ruling that credit-sensitive rates like AMERIBOR do not comply with international benchmark standards. We respect IOSCO, but it was a conclusion we felt was wrong at the time and one that we disagree with even more 12 months later. Countless folks we’ve spoken to in the industry continue to be bewildered by the decision, as smaller financial institutions clearly need a true reflection of their overnight credit-sensitive borrowing costs. ? Our position is and always has been straightforward. Commercial banks want to manage interest rate risk and maintain stable margins by charging a lending rate equal to a fixed spread over their borrowing costs. Because these banks do not have large positions in government securities, they tend to borrow at an unsecured rate.?SOFR, on the other hand, represents the secured borrowing rate used by dealers to provide leverage to hedge funds. It’s a completely different use case, and wholly inadequate for the needs of most commercial banks. These institutions should feel confident in choosing a benchmark rate that reflects their business. ? All the while, industry developments have been making the case for us. AMERIBOR is consistently 13-14 bps over the FEDFUNDS rate. Amid a fraught banking landscape and overall macroeconomic uncertainty, transactions using our benchmark rate have proceeded without issue. We’ve had conversations with many banks that tell us as much as 10% of their loan or asset portfolio is tied to AMERIBOR. In many of these cases, SOFR would cost them money and present unnecessary interest rate risk, emphasizing the dire need for credit-sensitive rates. ? With the steadfast support of our backers at 7RIDGE, we’ll continue to advocate for the necessity of a credit-sensitive rate – because a more stable, efficient lending landscape is worth fighting for. In the coming weeks, we look forward to sharing new independent research on why a credit-sensitive benchmark interest rate could be the right choice for many financial institutions. Until then, visit our website to learn more:?https://theafex.com/ ? #CSR#IOSCO#AFX#fedfunds

AFX CEO, John Shay, was quoted in Polo Rocha's American Banker article today saying, "AFX marketplace and supporters of AMERIBOR are undaunted" in response to the news of BSBY's cessation. Read the full article here: https://lnkd.in/eAZU--ZB

In response to the recent cessation of Bloomberg's short-term bank yield index, BSBY, AFX CEO John Shay let Risk.net's Helen Bartholomew know that AFX will remain a credit-sensitive option for America's regional and local banks. Shay stated, "Our bank members are fiercely loyal to the platform and we see no reason to cease. We are focusing on growth within the cash platform while running the benchmarks that replicate SOFR, with an all-important credit spread, in perpetuity." Read the full article here: https://lnkd.in/eCZsqQKe

ICYMI: Last week, AFX CEO, John Shay, was featured in Euromoney talking about how the AFX Marketplace has seen increased volume since the end of Libor in June 2022. Shay states, "We have 300 active users, including many regional and community banks that are core lenders to the real economy.” Read the full article here: https://lnkd.in/eHSQc3-d