American Financial Exchange (AFX)

American Financial Exchange (AFX) is a self-regulated electronic marketplace founded in 2015 that provides a platform for U.S. banks and financial institutions to lend and borrow short-term funds. The exchange allows banks to trade directly with each other in a forum that discloses bid and ask prices while maintaining user anonymity.
AFX is designed to bring standardization and transparency to interbank lending while reducing transaction costs through an electronic market.
AFX was acquired by 7RIDGE in 2023 and then by the Intercontinental Exchange in January of 2025.
==History==
AFX was created by Dr. Richard Sandor and launched on December 11, 2015 with six banks as members. It extended its membership beyond banks to include broker-dealers, private equity firms, business development corporations, hedge funds, futures commission merchants, insurance companies, asset managers and finance companies.. The exchange was designed to address the interbank funding needs of small and midsize banks. 
On its first day of trading a total value of $15 million was transacted, which the exchange said exceeded expectations.
By May 2019, AFX had grown to 147 members with combined assets of more than $2 trillion and an average daily volume of $2 billion.
The AFX posted a record trading day on September 19, 2019, of $3.035 billion across AFX products, and a record week that week with $13.017 billion worth of trades for the week of September 16-20, 2019. Nearly $1.7 trillion in interbank lending and borrowing has traded on the platform since its launch in 2015.
In April 2023, AFX was acquired by 7RIDGE, a specialized growth equity firm focused on transformative technologies for financial services. This acquisition was intended to accelerate AFX's growth trajectory and expand its network of members.
== Ameribor ==
Ameribor (American Interbank Offered Rate) is a benchmark interest rate that reflects the actual cost of short-term, unsecured interbank borrowing in the United States. It was introduced in 2015 by AFX and Richard Sandor as an alternative to LIBOR, which was phased out due to rate-setting scandals. Ameribor is based on transactions conducted on AFX.
The rate is calculated as the transaction-volume-weighted average interest rate of daily transactions in the AFX overnight unsecured loan market. It is expressed on an Actual/360 Day Count and Following Business Day convention, rounded to five decimal places. Ameribor is particularly suited for small to midsize banks, as it accurately represents the funding costs for banks outside the Federal Reserve's primary dealers. 
The benchmark has gained recognition from regulators, with Federal Reserve Chair Jerome Powell stating that "Ameribor is a reference rate created by the American Financial Exchange based on a cohesive and well-defined market." Ameribor adheres to all 19 principles for financial benchmarks established by the International Organization of Securities Commissions (IOSCO), further solidifying its credibility in the financial markets. IOSCO reviewed AFX's AMERIBOR's Term-30 forward-looking rate and on April 15, 2021 affirmed it also complied with its principles.
A futures contract on the benchmark was launched on AFX's partner exchange Cboe Futures Exchange on August 16, 2019, which was also the 42nd anniversary of the launch of Treasury bond futures.
== Technology ==
Cboe initially hosted, operated and provided surveillance for the AFX market and Chicago-based Northern Trust acted as a settlement bank. After AFX was acquired by 7RIDGE, the markets moved to a technology platform hosted by TNS and exchange technology developed by Connamara Systems. AFX contracted with Morningstar for its benchmark rate verification agenda and RSM for the development of the network surveillance oversight.
== Products and Services ==
AFX offers several key products and services:
* Unsecured Loan Market: A daily market for overnight and 30-day loans where members commit to lend and borrow short-term funds electronically based on standardized contracts.
* AFX Secured Loan Market: A market where members commit to lend and borrow short-term collateralized funds.
* AFX Deposit Market: A demand deposit market where members commit to place demand deposits in banks electronically based on standardized contracts.
* AMERIBOR Interest Rate Benchmark: A transaction-based short-term benchmark interest rate established through a market auction, specifically designed for the needs of midsize, regional, and community banks. 
As of November 2024, AFX's marketplace serves over 250 banks and financial institutions across all 50 U.S. states and Puerto Rico, representing approximately 25% of the U.S. banking sector's total assets.
== Key People ==
* John Shay: chief executive officer
* Kevin Wolf: chief financial officer
* Craig Benson: managing director, sales & marketing
* Rafael L. Marques: managing director, business development
* Scott Woodbury: managing director, sales & liquidity operations
* Robert Albertson: advisor
* Robert Albertson, Advisor
* Alan Sobba, Advisor
== History ==
AFX opened on Friday, December 11, 2015, with six banks as members and extended its membership beyond banks to also include broker-dealers, private equity firms, business development corporations, hedge funds, futures commission merchants, insurance companies, asset managers and finance companies.
On its first day of trading a total value of $15 million was transacted, which the exchange said exceeded expectations.
AFX membership has since grown to 231 members, which includes 186 banks and 45 non-banks. More than 1,100 correspondent bank participants are able to conduct loan transactions through their respective AFX member banks. In addition, membership includes 30 nonbanks, comprising broker dealers, private equity firms, business development corporations, hedge funds, futures commission merchants, insurance companies, asset managers and finance companies. As of October 11, 2019, active AFX markets included overnight, 30-day and 3-month unsecured loans, and 7-day secured loans. 
The AFX posted a record trading day on September 19, 2019, of $3.035 billion across AFX products, and a record week that week with $13.017 billion worth of trades for the week of September 16-20, 2019. Nearly $1.7 trillion in interbank lending and borrowing has traded on the platform since its launch in 2015.
== Products and Services ==
AFX currently provides the following categories of products:
*AMERIBOR Futures: cash-settled 3-month and 7-day contracts based on the compounded daily annualized AMERIBOR interest, or average simple daily annualized AMERIBOR interest.
*AFX Unsecured Loan Market: a loan market where members commit to lend and borrow short-term funds electronically based on standardized contract specifications.
*AFX Secured Loan Market:a loan market where members commit to lend and borrow short-term collateralized funds electronically based on standardized contract specifications.
*AFX Deposit Market: a demand deposit market where members commit to place demand deposits in banks electronically based on standardized contract specifications.
== References ==
Category:Exchanges
Category:Ameribor
Category:Interest Rates
Category:Benchmarks
Category:Financial Markets
Category:Banking
Category:Financial Services
Category:Companies Founded in 2015
Category:Chicago, Illinois
Category:Electronic Trading Platforms