ISDA® have published the Collateral Agreement Interest Rate Definitions in order to allow parties to incorporate standardised definitions relating to overnight interest rates into their ISDA® credit support annexes ('CSAs'). These new definitions include fallbacks which apply if a relevant benchmark (which is referenced in a CSA and which incorporates the Collateral Agreement Interest Rate Definitions) is permanently discontinued, or temporarily fails to be published. One can

With regulatory reform in the banking and finance sector focussing on the need to collateralise and secure exposures, there is renewed interest in collateral agreements. Many different derivatives, securities and financing transactions have collateral mechanisms built into the legal documentation which is used. This article aims to break down the main collateral agreements and give a brief overview of the mechanisms provided for securing the exposures and obligations intrinsi

Source: ISDA® Quarterly Vol 6, Issue 2: May 2020 (pages 36 to 39) The figures from ISDA®'s latest margin survey gives an interesting insight into the statistics for initial margin (IM). The first four phases of initial margin implementation have now been completed meaning that a total of over 50 firms are currently in scope for IM. The 20 dealer firms that were in scope in the first phase of the IM regulations collected $173.2 billion of IM at the end of 2019. This was $15.3

According to isda.org ... Collateral acts as a backstop that protects market participants and the economy as a whole. The requirement to post collateral is a key reform that makes the derivatives market more transparent, resilient and safe. ISDA’s new whiteboard animation video explains how collateral is used in the derivatives market, and how it makes the financial system safer. #collateral #derivativesmarket #variationmargin #initialmargin #counterparty

Regulatory changes will continue to be the main area of focus for the derivatives industry in 2018. In addition to that, new product types (Bitcoin and other cryptocurrencies) are also likely to dominate the way in which the derivatives industry will develop this year. Key areas of focus in 2018: MiFID II: The Markets in Financial Instruments Directive (MiFID) and the accompanying Markets in Financial Instruments and Amending Regulation (MiFIR) both originate from the Europea

As mandatory clearing of certain standardized OTC derivatives products starts to gain traction globally, as a potential Clearing Member (CM), it is pertinent to identify what factors one should consider in choosing a central counterparty clearing house (CCP). Many CCPs have sprung up in the market, each offering slightly different services, and not all CCP rules are consistent. For example, not all CCPs have the same default waterfall mechanics, or standardized events of defa

With the implementation of uncleared margin rules in the EU and US markets (and imminently expected in the South African market), collateral optimisation strategies have become a key focus for many firms. This article gives an outline of the automated collateral management solution offered by Strate for the South Africa market. CloudMargin and South Africa's First Tri-Party Collateral Agent - Strate Collateral Management - Bring Unprecedented Automation, Efficiencies to South

This fact sheet explains the many different industry sectors who use derivatives to effectively manage their business and financial risk. Who Uses Derivatives - and Why? If you would like to find out more about the legal agreements used to document OTC derivatives transactions, come along to DeriviDoc courses as follows: The ISDA® Master Agreement Tuesday 11 July 2017 in Johannesburg Collateral and the CSA Master Agreements Wednesday 12 July 2017 in Johannesburg #derivatives

Many market participants in the EU and US scrambled to get their collateral documentation in order ahead of the 1 March 2017 regulatory deadline for the posting of Variation Margin for uncleared swaps. This deadline posed a challenge for many, particularly the buy-side firms. This article gives interesting and relevant insight into the relief which EU and US regulators have given to the market on the variation margin deadline. If your firm still needs to get its collateral do

The Basle Committee on Banking Supervision (BCBS) and the International Organization of Securities Commission (IOSCO) have outlined the margin requirements for un-cleared OTC derivatives. These margin requirements are intended to be aligned globally and were due to be implemented by the industry’s largest participants by 1 September 2016. This deadline was met by the US and Japan; however the EU, Switzerland, South Africa and APAC countries have not yet published their finali