ISDA®
INTERNATIONAL
SWAPS AND DERIVATIVES ASSOCIATION, INC
NEWS RELEASE
For
Immediate Release Thursday, January 31, 2008
For More Information, Please Contact:
Scott Marra, ISDA New York, 212-901-6013, smarra@isda.org
ISDA
PUBLISHES QUEBECOR PROTOCOL
The 2008 Quebecor CDS Protocol permits cash
settlement of single-name, index, tranche and other
credit derivative transactions. The Protocol offers market participants an
efficient way to settle credit derivative trades referencing Quebecor. It enables parties to agree to settle their
trades on a multilateral basis based on a final price established at auction.
This approach to settlement brings considerable operational efficiencies, while
also preserving a participant’s right to receive or deliver obligations if
desired. Markit and Creditex
will administer the auction, scheduled for February 19, 2008, which will
determine the final price for Quebecor bonds.
“At a time when credit concerns are permeating
the global financial markets, the ISDA mechanism reassures derivatives industry
participants of a smooth and reliable settlement process,” said Robert Pickel, ISDA’s Chief Executive Officer and Executive Director.
“ISDA is committed to supporting the integrity of credit risk management
practices and operational efficiency across privately negotiated derivatives.”
While earlier ad hoc protocols enabled cash
settlement only of index trades, this is the second time this settlement
methodology has been applied to a broad range of credit derivative
transactions. The mechanism was successfully implemented in the 2006 Dura CDS
Protocol.
The Protocol is open to ISDA members and
non-members alike. The adherence period
for the Protocol runs until February 8, 2008.
The text of the Protocol and form of adherence
letter, guidance on the mechanics of the Protocol, answers to frequently asked
questions and details on adherents, are all available at www.isda.org. Details on the auction are included in the
Protocol.
About ISDA
ISDA, which represents
participants in the privately negotiated derivatives industry, is among the
world’s largest global financial trade associations as measured by number of
member firms. ISDA was chartered in 1985, and today has approximately 805
member institutions from 55 countries on six continents. These members include
most of the world’s major institutions that deal in privately negotiated
derivatives, as well as many of the businesses, governmental entities and other
end users that rely on over-the-counter derivatives to manage efficiently the
financial market risks inherent in their core economic activities. Information about ISDA and its activities is
available on the Association's web site: www.isda.org.
®ISDA is a registered trademark of the International
Swaps & Derivatives Association, Inc.