The ASX been appointed to administer the bank bill swap rate following a tender process by the Australian Financial Markets Association (AFMA).
The AFMA announced in May 2016 it would hand over the administration of the bank bill swap rate (BBSW) resulting in a competitive tender process for the job.
As a result, the ASX has been appointed to become the administrator of the benchmark interest rate on 1 January 2017.
ASX managing director and chief executive Dominic Stevens said, "ASX is delighted to be chosen as the new administrator of the Bank Bill Swap benchmark rate for Australia’s financial markets."
The ASX and AFMA will work together on coming up with a new BBSW calculation methodology based on volume weighted average price (VWAP).
Currently, the BBSW is calculated via the nationally observed best bid and offer (NBBO) methodology.
"The change in methodology will support the recommendation of the Council of Financial Regulators and reflects the evolution of market practice," said the ASX.
Three of the four major banks are currently defending court action brought by ASIC regarding manipulation of the BBSW.
[Related: Australian banks sued for monopolising trade]