For Immediate Release Tuesday, November 22, 2005
For More Information Contact:
Louise Marshall, ISDA New York, (212) 901-6000; lmarshall@isda.org
NEW YORK, Tuesday, November 22, 2005 – The International Swaps and Derivatives Association (ISDA) has published Additional Provisions for Constant Maturity Default Swaps (CMCDS) that enable market participants to readily document these trades under the ISDA Master Agreement framework.
A constant maturity credit default swap is a credit derivative, the fixed payment of which is reset periodically at the prevailing credit default swap rate. It is anticipated that the Provisions will be used primarily but not exclusively in inter-dealer transactions.
These Additional Provisions are for use with the 2003 ISDA Credit Derivatives Definitions by substitution into the appropriate section of the confirmation form. Publication of provisions for CMCDS complements the growing range of credit derivative documentation available under ISDA.
“These provisions set forth common reference terms for a new and growing sector of the credit derivatives marketplace. They will assist in providing product standardization and therefore in boosting potential liquidity in the sector,” said Robert Pickel, Executive Director and Chief Executive Officer, ISDA.
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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