IntercontinentalExchange Group (ICE) has been tapped to run the leading global benchmark for interest rate swaps, the ISDAFIX.

The ISDAFIX represents the average mid-market swap rates for four major currencies: the U.S. dollar, the Euro, the British pound, and the Swiss franc, at selected maturities on a daily basis. The benchmark is used to price and settle derivatives contracts and as a reference rate for floating rate bonds.

Today, ICE Benchmark Administration (IBA) was announced as the new administrator for the benchmark, following a selection process managed by the International Swaps and Derivatives Association (ISDA). It will take over daily operations of the benchmark, governance, and oversight to ensure the integrity of the benchmark. Most important, it will handle the transition in calculation methodology from a model where banks submit price estimates, to a methodology based on tradable quotes posted on regulated trading venues.

In the wake of the LIBOR market manipulation scandal, financial benchmarks are moving to calculation methodologies that rely more on actual trade data. The IBA says that this change in methodology is made possible by the introduction of electronic markets for interest rate swaps, and is designed to align the benchmark with principles published last year by the International Organization of Securities Commissions (IOSCO) for financial benchmarks; which were subsequently endorsed by the G20 and by the Financial Stability Board (FSB).

Earlier this year, the IBA was also selected by the UK’s Financial Conduct Authority (FCA) to administer LIBOR. Since then, it has been working to transition LIBOR and improve the integrity and transparency of the benchmark, including establishing a new oversight and governance framework, and adopting new surveillance technology and analytical tools to operate the benchmark setting process.

The IBA expects to transition the Euro ISDAFIX benchmark in the summer, with additional currencies transitioning by the end of 2014. The final date of transfer for ISDAFIX benchmark rates to IBA will be confirmed once terms have been finalized with regulated trading venues.

“We are delighted to be selected by ISDA as the new administrator for ISDAFIX which is an endorsement of the efforts ICE has already undertaken to improve the integrity of benchmarks, since assuming the administration of LIBOR earlier this year. This mandate shows that the industry has confidence in our ability to oversee and evolve benchmarks in a transparent, independent and neutral manner,” said Finbarr Hutcheson, president OF IBA.