The London Stock Exchange’s former head of post-trade services Kevin Milne has been appointed CEO of Singapore’s Rates Validation Services, a benchmarking firm which is looking to set up an alternative to Libor, the discredited interbank lending rate.
The RVS QED service has been in development since 2010 and incubated with the global and domestic banks in Australia. The service provides daily benchmarks for all asset classes and products traded for each centre “following the sun” during each 24-hour period.
RVS is currently in the process of hiring 100 additional staff as it begins the roll-out of QED in support of the Australian Financial Markets Association’s (Afma) bank bill swap rate.
Milne, who left the LSE in a reshuffle of its post-trade operations in June, has been recruited to lead the company’s effort to establish the service in international markets. He says the firm is running a parallel proof-of-concept pilot of QED in London with a consortium comprising 18 of the world’s largest banks.
FSA director Martin Wheatley last week set out plans to overhaul the Libor benchmark which has been rocked by evidence of systemic abuse by traders rigging the rate to boost their bonuses and the standing of their bank.
Wheatley is proposing to run a competitive tender for an independent third party to manage the handling and submission of data under a new governance regime. The tender process is likely to attract bidders from across the market data and index compilation industry, including Thomson Reuters (which calculates the current rate on behalf of the BBA), Bloomberg, Markit and FTSE.
RVS’s QED model largely automates the collection of data from submitting banks, and the firm claims to have developed a “unique governance model” through its work with Afma.