For Immediate Release Monday, November 21, 2005
For More Information Contact:
Louise Marshall, ISDA New York, (212) 901-6000; lmarshall@isda.org
NEW YORK, Monday,
November 21, 2005 - The International Swaps and Derivatives Association,
Inc. (ISDA) has launched a Master Agreement that will govern certain terms
on which a fund manager 'gives up' its business with an executing dealer to
a prime brokerage firm. The 2005 ISDA Master Give-Up Agreement passes on the
economics of the fund's trade or trades with its dealer firm counterparties
to a prime brokerage firm in return for a management fee, so that all ensuing
transactions are conducted between the executing dealer and the prime broker.
Key features of the Agreement are in addressing when the prime broker is legally
obligated to a trade with the fund and the trading limits applicable to the
prime broker's relationship with the fund. Products covered by the Agreement
are interest rate swaps, caps and floors, swaptions, credit derivative transactions,
cross-currency swaps, FX transactions and currency option transactions.
"This is an exciting new example of how ISDA's work assists market development
through documentation solutions," said Robert Pickel, Executive Director and
Chief Executive Officer, ISDA. "The Master Give-Up Agreement will facilitate
the smooth functioning of this important relationship between fund managers,
prime brokers and the dealer community."
About ISDA
ISDA is the global trade association representing leading participants in
the privately negotiated derivatives industry. ISDA was chartered in 1985,
and today has more than 650 member institutions from 47 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.
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