The International Swaps and Derivatives Association (ISDA) said on Thursday it had received its first request to consider whether a credit event had occurred, according to the ISDA website.
Swiss bank UBS asked ISDA's determinations committee to consider whether a failure to pay credit event had occurred, citing a missed deadline to deliver interest payments to exchange bondholders.
If the request is accepted, the 15-member committee will vote on whether a payment on Argentine Credit Default Swap (CDS) contracts can be triggered. It could meet and make a decision as soon as Friday, market participants say, although the process could take longer.
Any ruling that a credit event had occurred would set off a series of insurance payments and give most of Argentina's current bondholders the right to demand their money back immediately. The deadline is Aug. 4, according to analysts. Credit Suisse earlier said CDS were likely to be triggered.
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The International Swaps and Derivatives Association (ISDA) today effectively declared Argentina in default, setting in motion a process that could trigger payments worth up to USD1bn on credit default swaps.Aug 01st, 2014 - 07:29 pm 0
ISDA's 15-member determinations committee decided that a failure to pay event has occurred on the contracts on July 30, the day Argentina missed a coupon payment on some of its restructured foreign-law bonds.
The deliberation, which needed an 80% majority to go through, was prompted by a request submitted on Thursday by Swiss bank UBS.
Taken from the BA Herald.
It's a bit like asking turkeys to vote for Christmas asking the insureres to vote a payout, even if some of them will benefit directly from it.Aug 01st, 2014 - 08:56 pm 0
The ISDA board has a mixture of winners and losers on this matter. I'm surprised that the vote was 100% for as the finding is detrimental to some of their respective interests. Probably more perlexing to RG considering their appreciation for the rule of law.Aug 02nd, 2014 - 06:25 pm 0