2008 Icelandic Banks CDS Protocols
The 2008 Landsbanki CDS Protocol relates to settlement issues concerning Landsbanki Íslands hf ("Landsbanki"), that was subject to the appointment of a "receivership committee" on Tuesday October 7, 2008. The 2008 Glitnir CDS Protocol relates to settlement issues concerning Glitnir Banki hf ("Glitnir"), that was subject to the appointment of a "receivership committee" on Tuesday October 7, 2008. The 2008 KaupÞing CDS Protocol relates to settlement issues concerning KaupÞing Banki hf ("KaupÞing "), that was subject to the appointment of a "receivership committee" on Wednesday October 8,2008. Each of the 2008 Landsbanki CDS Protocol, the 2008 Glitnir CDS Protocol and the 2008 KaupÞing CDS Protocol are referred to as the “Protocol(s)”.
The purpose of the Protocol(s) is to offer market participants an efficient way to address the settlement issues relating to credit derivative transactions referencing Landsbanki, Glitnir and KaupÞing (as appropriate). The Protocol(s) will offer institutions the ability to amend their documentation for various credit derivatives transactions in order to utilize an auction scheduled for:
Markit Group Limited and Creditex Securities Corp. will administer each auction.
The Protocol(s) are open to ISDA members and non-members. The Protocol(s) will be open between October 27, 2008 and October 31, 2008.
PLEASE NOTE: THIS PROTOCOL IS CLOSED.
| The following documents must be submitted via email to the ISDA office in London in order to adhere to the 2008 Kaupþing Banki hf/Landsbanki hf/Glitnir Banki hf CDS Protocol(s):
The same letter allows an entity to adhere to any or all of the three Protocol(S) by checking the appropriate box to indicate which Protocol(s) the entity wishes to sign up to.
Click here for form of Adherence Letter.
ISDA will only accept email delivery of Adherence Letters. An Adhering Party is not required to send original Adherence Letters to the ISDA offices.
Please submit all Adherence Letters via email to email@example.com. It is critical that both a scanned, signed Adherence Letter, as well as a scanned, conformed Adherence Letter is submitted. Entities will not be deemed to have adhered to the Protocol(s) until both the signed and conformed Adherence Letters are submitted by email in accordance with the Adherence Period.
You are not required to send your original Adherence Letter(s) by mail to ISDA.
No other documents are required in order to adhere to the 2008 Kaupþing Banki hf/Landsbanki hf/Glitnir Banki hf CDS Protocol(s).
The Protocol will open for adherence on Monday, October 27, 2008.
Email address for Delivery of Adherence Letters:
Policy Regarding Conformed Copies
The most common problem experienced in the adherence process for prior Protocols was the failure to include a conformed copy of the Adherence Letter. We remind parties that a conformed copy, together with a signed copy, must be submitted to ISDA in connection with adherence to the 2008 Kaupþing Banki hf/Landsbanki hf/Glitnir Banki hf CDS Protocol(s).
|ISDA has prepared this brief summary of frequently asked questions to assist in your consideration of the 2008 Kaupþing Banki hf/Landsbanki hf/Glitnir Banki hf CDS Protocol (the “Protocols”).
THIS FREQUENTLY ASKED QUESTIONS DOES NOT PURPORT TO BE AND SHOULD NOT BE CONSIDERED A GUIDE TO OR AN EXPLANATION OF ALL RELEVANT ISSUES OR CONSIDERATIONS IN CONNECTION WITH THE 2008 KAUPÞING/LANDSBANKI/GLITNIR CDS PROTOCOL. PARTIES SHOULD CONSULT WITH THEIR LEGAL ADVISERS AND ANY OTHER ADVISER THEY DEEM APPROPRIATE PRIOR TO USING OR ADHERING TO THE PROTOCOLS. ISDA ASSUMES NO RESPONSIBILITY FOR ANY USE TO WHICH ANY OF ITS DOCUMENTATION OR OTHER DOCUMENTATION MAY BE PUT.
This Frequently Asked Questions webpage is divided into three sections: (i) questions relating to the submission of Adherence Letters; (ii) questions relating to the election of an entity not to participate in a Protocol; and (iii) questions relating to the substance of the Protocols including physical settlement.
Adherence Letter Submission Process
The Adherence Letter refers to three protocols but I only want to sign up to one/two of them?
When do I need to send in my Adherence Letter?
How do I send in my Adherence Letter?
The Adherence Letters should be on your institution’s letterhead. Nothing in the form of Adherence Letter available on ISDA’s website may be changed with the exception of completing the details of your institutional name, date and signature block and checking the relevant box(es).
What is a conformed copy?
Who is an authorised signatory?
What if I am an investment or asset manager – how do I complete the signature block?
As an alternative, an investment or asset manager may list the specific funds that are adhering to the Protocols by indicating in the signature block: "Investment/Asset Manager, acting on behalf of the funds and accounts listed below". Click here for example. Please note that in this case the names of those funds must be provided and will be publicly disclosed on the ISDA website.
However, in order for Physical Settlement Requests to be calculated by Participating Bidders, each such investment/asset manager is required to provide a list of all funds and accounts that it acts on behalf of to each Participating Bidder that has (or whose affiliate has) entered into a Master Agreement with any of those funds or accounts. As provided in paragraph (1) of the Auction Methodology set out in Exhibit 2 of the relevant Protocol, on the Business Day prior to the Auction Date, the Administrators (Markit and Creditex) will publish a list of the Participating Bidders on their respective websites. In addition, contact details will be available for the Participating Bidders through their Adherence Letters on the ISDA website.
Can I change the text of the Adherence Letter?
Does it cost any money to adhere to the Protocol?
Entities Electing Not to Adhere to the Protocol
Scope of Transaction Coverage Relating to the Protocol
Does adhering to the Protocol affect other credit derivative transactions?
What credit derivative transactions are not affected by adhering to the Protocol?
When is the auction?
Details of the auction results will be posted at www.creditfixings.com.
Physical Settlement through the auction
I want to physically settle through the auction, what do I have to do?
Following the auction, each party that submitted a Physical Settlement Buy or Sell Request that is matched in the auction will be treated as if they had entered into an agreement with the relevant Participating Bidder on terms equal to a Representative Auction-Settled Transaction (RAST). Parties that submitted a Physical Settlement Sell Request must send a Notice of Physical Settlement to the relevant Participating Bidder, specifying which Deliverable Obligations they will deliver in settlement of that transaction. A form of Notice of Physical Settlement is contained as an exhibit in the Protocol. The deadline for sending this notice is specified as the "Notice of Physical Settlement Date" in the relevant Protocol.
Can I deliver Senior Obligations into a RAST resulting from a Subordinate Auction?
If I want to deliver Deliverable Obligations in a currency other than EUR, how is the FX calculated?
Cash Settlement Date and Accruals
How are accruals calculated?