FTSE Russell, LSEG’s global index provider, today announced the launch of FTSE Term ZARONIA, a new forward-looking interest rate benchmark designed to aid South Africa’s transition to transaction-based reference rates.

The launch follows FTSE Russell’s selection by the Market Practitioners Group to develop and administer a term rate benchmark based on ZARONIA, the South African Rand Overnight Index Average, to support the transition from JIBAR. The benchmark is designed to provide greater certainty for borrowers, lenders and investors who need to know the applicable interest rate at the start of an interest period.

The benchmark has been developed following industry testing of the prototype and in consultation with market participants and relevant stakeholders. It also leverages FTSE Russell’s extensive experience delivering benchmark reform solutions across major global markets.

Jacob Rank-Broadley, Head of Interest Rate Benchmark Solutions at FTSE Russell, said:

“The launch of FTSE Term ZARONIA marks an important milestone in the evolution of South Africa’s financial markets. Transparent, forward-looking and built on transaction and executable market pricing data to relevant industry standards, it helps market participants navigate the transition while supporting a resilient, sustainable benchmark ecosystem.”

FTSE Term ZARONIA combines transaction data and executable market pricing inputs to create a benchmark designed to reflect underlying market conditions and support benchmark robustness across varying liquidity environments. The methodology has been developed in line with international benchmark standards and informed by FTSE Russell’s experience administering interest rate benchmarks across multiple jurisdictions.

The benchmark represents a collaborative effort where FTSE Russell has drawn on data capabilities from LCH, Tradeweb, Latium Capital, GFI, TraditionData and GMG.