iBoxx, the leading independent European fixed income index provider, will administer the rules governing the indices in its role as neutral service provider, and license its name for use with the related credit default swap products.
The consortium of banks comprises ABN AMRO, Barclays Capital, Bear Stearns, Citigroup, Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, HSBC, Lehman Brothers, Merrill Lynch and UBS. Additional banks are expected to join in the near future.
The first product, US iBoxx CDX.NA.IG, is a 125-name portfolio of U.S. investment grade credit default swaps, which are equally weighted and selected by a set of transparent rules, designed to ensure a representative group of diversified US investment grade borrowers. US iBoxx CDX.NA.IG will be segregated into five sectors: Industrials, Consumers, Energy, Financials and TMT.
David Mark, CEO of iBoxx, said, "We are excited to be working with this group of prime financial institutions on this project in a rapidly growing market. This venture is further proof that the fixed income market is keen to adopt neutral, transparent, multiple contributor, accessible indices and associated products. This complements our previously announced plans to launch a family of US Dollar cash bond indices over the coming months"
