Marsoft announced it would begin monitoring and distributing the Secured Overnight Financing Rate (SOFR) following LIBOR's retirement from the banking sector after more than five decades of use.
Key Distinctions:
Unlike LIBOR, which incorporated credit risk measures, SOFR operates as an overnight secured rate with minimal risk exposure. The benchmark typically registers below traditional LIBOR rates.
User Benefit:
Marsoft Flagship subscribers gain the capability to implement an adjustment spread above SOFR, designed to prevent substantial economic shifts resulting from the transition between these benchmarks.
SOFR's risk-free nature and lower positioning compared to LIBOR represent a significant methodological shift in interest rate benchmarking, with Marsoft providing tools to manage this transition for its clientele.
