ICE acquires BAML’s fixed income indices platform

Exchanges are looking to expand into more profitable alternative business lines such as the index and market data business.

Intercontinental Exchange (ICE) has acquired a major fixed income indices platform from Bank of America Merrill Lynch (BAML), the second big deal from an exchange group to expand its index capabilities.

ICE will take over the global research division’s index platform from BAML, the second most-used fixed income indices by assets under management (AUM) globally.

Upon closing, the AUM benchmarked against the combined fixed income businesses of ICE will stand at nearly $1 trillion.

“We believe the BAML Global Research FICC indices will offer customers more choice alongside the ICE US Treasury indices and NYSE equity indices as comprehensive, trusted benchmarks,” said Lynn Martin, president and COO, ICE Data Services.

Terms of the deal were not disclosed, which is expected to completed by the end of the year.

“As the demand for independent indices rises, we are pleased to monetize this valuable set of benchmarks with a strategic owner,” said Candace Browning, head of Global Research, Bank of America Merrill Lynch.

The acquisition follows the purchase of Citi’s fixed income index business by the London Stock Exchange Group (LSEG) earlier this week for $685 million.

Exchanges are looking to expand into more profitable alternative business lines, such as the index and market data business, with revenues from traditional lines drying up.

In the first quarter of this year, ICE saw revenues from its trading and clearing businesses decline by 6% year-on year. However, its data and listing business saw an 8% growth overall, in which data services grew by 9% to %520 million.