MetLife Inc. is giving a boost to the new dollar funding benchmark that’s been designed to replace Libor, with the U.S. insurer selling a $1 billion bond tied to the secured overnight financing rate.
A debt-issuing unit of the company sold two-year floating-rate notes linked to SOFR, according to a person familiar with the matter, who asked not to be identified because they’re not authorized to speak about it. It is the first such transaction of benchmark size from a company that isn’t either a top-rated sovereign, supranational or agency issuer.
SOFR, which was developed by the Federal Reserve Bank of New York as a dollar-market alternative to the beleaguered London interbank offered rate, has been gaining traction recently with financial institutions. Fannie Mae, Credit Suisse, Barclays and the World Bank have each sold various types of SOFR-linked debt previously.