CFTC Approves "Made Available to Trade" Determination for SOFR and SONIA Overnight Swaps
The CFTC approved a made-available-to-trade ("MAT") determination for certain overnight index swaps referencing the Secured Overnight Financing Rate ("SOFR") and Sterling Overnight Index Average ("SONIA").
The CFTC stated that swaps subject to the MAT determination must comply with trade execution requirements from August 5, 2023 - i.e., must be executed on a swap execution facility, derivatives contract market or exempt SEF. The CFTC published a full list of the details of new swaps subject to the trade execution requirement.
Commentary
It was inevitable, from the moment the CFTC made mandatory clearing determinations for these products, that many would be made subject to mandatory trade execution. And following Tradeweb's proposal in April of this year, it was only a matter of the exact date.