ICICI Bank executes secure overnight rate-linked financing transactions



In January, ICICI carried out its first interbank money market transaction linked to SOFR.

New Delhi: Private lender ICICI Bank announced on Thursday that it has executed its first term loan and currency swap derivative transactions linked to the Guaranteed Overnight Funding Rate (SOFR).

The transactions were carried out with a corporate client through the international offices of the bank. ICICI Bank said these transactions indicate that it is ready to move smoothly from LIBOR (London Interbank Rate) in US dollars to transactions linked to Alternative Reference Rates (ARR).

Earlier in January, ICICI executed its first interbank money market transaction linked to SOFR, which was identified as a replacement for USD LIBOR.

Anuj Bhargava, Head of Global Clients Group, ICICI Bank, said: “The lender has been actively working with clients for a smooth transition from LIBOR to ARRs. These transactions are just the start of the transition to ARRs.

B Prasanna, ICICI Bank Group Head – Global Markets, Sales, Trading & Research, said: “With the multitude of measures announced by regulators globally, there is an increased shift towards products related to ARR in the markets. As the termination date approaches, the liquidity in ARR related products will increase and ICICI Bank is ready to expand its product line to meet customer requirements. “

The Reserve Bank of India (RBI) had, in August last year, asked banks to develop a plan approved by the Board, outlining an assessment of LIBOR-related exposures and the measures to be taken to address the risks arising from them. termination, including preparation for RAR adoption.

SOFR is linked to transactions in the US Treasury market. Libor is expected to be phased out at the end of 2021.

Contactless payment solution via the ICICI Bank application

In a separate development, the lender on Wednesday launched a contactless payment service through its banking app, iMobile Pay, which allows customers to use their smartphones to pay at point of sale (POS) at merchant points of sale. “The service provides enhanced convenience to more than 1.5 crore of the Bank’s debit and credit card customers, as they will no longer need to carry their cards for payments at retail stores,” said ICICI Bank.

The “Tap to Pay” feature via iMobile Pay is now available on Visa cards and will soon be enabled on Mastercard cards as well, he said.

The bank further mentioned that for transactions over Rs 5,000, customers will need to enter their card’s PIN (Personal Identification Number) and wave the phone near the point-of-sale device.


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