A Practical Guide to the 2003 ISDA Credit Derivatives Definitions

A user-friendly guide to these complex Definitions for market practitioners and those new to credit derivatives documentation. In addition to a comprehensive section by section commentary on the Definitions themselves, this book ensures that you understand: The evolution of the global credit derivatives market, the main credit derivative products and risks associated with them. Legal issues affecting credit derivatives and some causes celebres. New developments in the credit derivatives market, including master confirmation agreements, ISDA credit derivatives documentation projects and electronic processing of credit derivatives contracts. Includes a glossary of key terms used in the Definitions and reproduction of the Definitions, the May 2003 Supplement to the Definitions and the 60 Business Day cap side letter all reproduced with the kind permission of the International Swaps and Derivatives Association, Inc.

Table of Contents:
Contents Acknowledgements About the author Foreword Preface Glossary Chapter 1 General overview Introduction Evolution of the credit derivatives market and market size Uses of credit derivatives Their main use: transferring risk to a third party The main credit derivatives products Risks associated with credit derivatives Chapter 2 Legal issues affecting credit derivatives The insurance question Gaming Netting Transferability Confidentiality Selected causes celebres Chapter 3 The 2003 ISDA Credit Derivatives Definitions Preamble Article I Certain General Definitions Article II General Terms Relating to Credit Derivative Transactions Article III Conditions to Settlement Article IV Credit Events Article V Fixed Amounts Article VI General Terms Relating to Settlement Article VII Terms Relating to Cash Settlement Article VIII Terms Relating to Physical Settlement Article IX Additional Representations and Agreements of the Parties Article X Novation Provisions ISDA fallbacks in the 2003 Definitions Chapter 4 New developments The ISDA Credit Derivatives Market Practice Committee and working groups Rule on when credit protection starts The 2003 Master Credit Derivatives Confirmation Agreements The May 2003 Supplement The 60 Business Day Cap on Settlement Capital relief for Restructuring under Basle II Standardisation of Scheduled Termination Dates Initial stub period ISDA documentation projects Electronic processing of credit derivative contracts Credit Index Futures Further reading Index Annex 1 2003 ISDA Credit Derivatives Definitions Annex 2 May 2003 Supplement to the 2003 ISDA Credit Derivatives Definitions Annex 3 Letter Agreement Relating to 60 Business Day Cap on Settlement

Review :
"Credit Derivatives Definitions" is Paul Harding's lucid contribution to sorting out the evolution and current issues of ISDA language. He clearly defines key products and then clearly defines the key issues surrounding the documentation of these products. Harding translates the international Tower of Babelof ISDA documentation and achieves the previously impossible task of writing a book about credit derivatives documentation that is a pleasure to read. Paul Harding's book is an essential addition to the desk of every credit derivatives trader, structurer, marketer, and investor. Janet Tavakoli, President, Tavakoli Structured Finance, Inc. For a sector of the global derivatives industry that is still a fairly recent phenomenon, this book already feels long overdue. Any practitioner that has had to work with the ISDA Definitions over recent years, will have wondered why there wasn't a user's guide. Now there is. Kurt Crommelin, Head of Legal, HVB Corporates & Markets, Bayerische Hypo- und Vereinsbank AG "When I first heard of Paul Harding's plan to write this book, I welcomed it. In particular, since I know how helpful his books are in both the day-to-day work and the training of new colleagues... All his books have been practical guides making the complicated, simple. He has done the same here. This book not only concentrates on the Credit Derivatives Definitions themselves, it also explains the historical background, the uses of credit derivatives and the risks associated with them. This combined with a step-by-step explanation of the Credit Derivatives Definitions creates a good overview and understanding of the whole topic. I am pretty sure that traders, negotiators and lawyers will find this book very helpful. And I will not be surprised, if in future negotiators try to convince me by referring to this book!" - Wilfried F. Schutte, Senior Legal Counsel, DZ BANK AG Deutsche Zentral-Genossenschaftsbank, Frankfurt am Main Practitioner friendly, "A Practical Guide To The 2003 ISDA Credit Derivatives Definitions" is a very useful title for credit derivative practitioners seeking a reference text for the documentation of credit default swaps. The Finance and Treasury Professional, August 2004