Twelve dealers have stated they will use Swapswire to reach compliance with the 2005 Novation Protocol, published by the International Swaps and Derivatives Association (ISDA). ISDA issued the protocol to reduce derivatives settlement backlogs, a large percentage of which are due to novations, the mechanism by which buy-side clients exit derivatives positions prior to maturity by transferring the rights and obligations of the original transaction to a third party. The 12 dealers are: ABN Amro, Barclays Bank, BNP Paribas, Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, J.P. Morgan Chase & Co., Lehman Brothers, Merrill Lynch, Morgan Stanley, Royal Bank of Scotland, and UBS Investment Bank. The Swapswire system allows the transferer to communicate a fully defined derivative transaction with all trade detail to both the so-called remaining party and the transferee. The remaining party can signal their consent, and the transferee can also confirm that they have received and are in agreement with the trade details. The process used effects a fully ISDA-compliant legal novation confirmation in electronic format, eliminating the need for the three parties to separately generate and match novation documentation. Swapswire supports a wide range of OTC derivative products including interest-rate, credit and equity derivatives.

Existing Users Login

Sign up for Complimentary Access or Subscribe to Read this Article

For instant access to our A-Team Insight content, you can sign up for 30-day complimentary access to the full content of our news services. This will enable you to read the latest in-depth analysis on the stories that matter to you, access and search our full archives, and receive the latest monthly issue of A-Team Insight in convenient PDF format.

You may qualify for annual complimentary access if you are a senior manager at a financial institution (bank, brokerage, asset management firm, etc.).

For more information or to register, CLICK HERE for instant complimentary access.

Already like what you've seen and know you want to subscribe? An annual subscription is priced at £495/$795 and gives full access for up to three people to all our online content and the monthly A-Team Insight digest of the top news in PDF format. CLICK HERE to subscribe now.