ISDA PUBLISHES DOCUMENTATION TO ALIGN DERIVATIVES AND SFT MARKETS
The International Swaps and Derivatives Association has published new documentation and related set of provisions designed to allow firms to document derivatives and securities financing transactions (SFTs) under a single ISDA Master Agreement. ISDA points out that a single agreement for both derivatives and SFTs will reduce complexity and duplication, create efficiency in documentation negotiation and management, and enable documentation updates to be rolled out consistently for both sets of products. Using a single agreement will also result in expanded netting opportunities, helping firms to reduce credit risk and optimize their collateral use. ISDA says it will shortly commission updated netting opinions covering SFTs, with the first scheduled to be available later this year.