Nilai kami orang-orang kami Memimpin penerbit b2b, yang mengkhususkan diri dalam komunitas profesional online dan interaktif Dengan berbagai layanan termasuk situs web, publikasi email, penghargaan dan acara industri, Sift Media memberikan konten bermerek dan asli kepada lebih dari setengah juta profesional di bidang akuntansi, TI, SDM Dan pelatihan, pemasaran, dan usaha kecil. Dengan menghasilkan konten berkualitas dan melibatkan pemirsa profesional kami di beberapa titik sentuh, kami menawarkan peluang pemasaran unik dari merek b2b yang menghasilkan laba atas investasi yang sesungguhnya. Nilai Kami Kami percaya dalam menciptakan konten, memungkinkan percakapan dan mengubah peluang bisnis, baik untuk khalayak bisnis maupun klien periklanan kami. Dengan berfokus pada konten dan mendorong keterlibatan masyarakat, kami bertujuan untuk menciptakan lingkungan yang terpercaya dan unik bagi merek bisnis dan profesional bisnis untuk mengoptimalkan hubungan. Orang-orang kami Orang-orang kami adalah aset terbesar kami dan kami beruntung mendapatkan beberapa talenta digital terbaik di negara ini. Dengan tim manajemen senior, manajer kampanye dan akun berpengalaman, editor pemenang penghargaan, dan tim produksi dan teknologi terdepan, kami memiliki struktur dan kualitas yang membedakan kami dari penerbit lain. Cari tahu lebih lanjut dan temui tim di bawah ini. Tom Dunkerley Direktur Keuangan Steven Priscott, Menyaring Sejarah Kami Didirikan oleh Andrew Gray, David Gilroy dan CEO Ben Heald saat ini, Sift menawarkan layanan informasi khusus industri yang memanfaatkan internet dengan mengintegrasikan berita dan konten web tradisional. Dengan latar belakang Bens di bidang akuntansi, diputuskan bahwa ini adalah pasar eksplorasi pertama dan pada tahun 1997 AccountingWEB. co. uk lahir. Rumusnya berhasil, dan dalam 12 bulan daftar sirkulasi telah meningkat dari 10 menjadi 4.000, dengan pendapatan dihasilkan dari iklan dalam buletin mingguan mingguan. Sift Media sekarang menjangkau lebih dari 700.000 profesional bisnis terdaftar setiap bulan dan memberikan lebih dari 5 juta tayangan halaman di seluruh portofolio 11 judul di Inggris dan Amerika Serikat. Tidak hanya kami terus mengembangkan beberapa komunitas bisnis online yang paling setia dan terlibat, kami memberikan solusi terdepan untuk pengiklan. Untuk riwayat yang lebih rinci, kunjungi situs perusahaan kami. Jika Anda ingin bergabung dengan salah satu penerbit paling menarik di Inggris dan Anda yakin memiliki gairah dan keterampilan untuk menjadi bagian berharga dari tim, mengapa tidak memeriksa lowongan kami saat ini. Saya telah mengajar pegolf dari pemula hingga profesional tur, pemain perguruan tinggi Untuk mencapai amatir dan selebriti junior lokal kami untuk Hollywood. Saya telah mengajarkan ribuan pelajaran dan membantu semua lapisan pegolf membangun, mengembangkan dan memperbaiki permainan golf mereka selama lebih dari 25 tahun di Torrey Pines termasuk perpaduan penuh, shortgame, pengaturan, pengelolaan kursus dan sisi mental permainan. Program yang disesuaikan ditawarkan untuk membuat Anda memukul bola lebih tegak dan lebih jauh dengan sedikit pukulan, lebih memahami, sedikit usaha dan menambah kenikmatan. Hubungi saya di sel saya di 619-322-8333 atau isi formulir kontak saya untuk kebutuhan layanan golf Anda. Saya berjanji kepada Anda untuk melakukan yang terbaik untuk memperbaiki keseluruhan permainan Anda. Klik di sini untuk melihat Bio saya. Jasa Pelajaran: semua paket yang disesuaikan termasuk pemesanan lanjutan, biaya hijau, instruksi, keranjang, berbagai pilihan amp bola Torrey Pines North atau South Course dengan Pelajaran Bermain atau Sekolah Golf Tee kali tanpa biaya reservasi lanjutan untuk Bermain Pelajaran, Siapkan Dan Paket Bermain atau Sekolah Golf Bola dengan jangkauan terbatas di Pelajaran Privat dan Sekolah Golf Analisis video komputer berteknologi tinggi dengan Pelajaran Privat, Paket Pampp dan Sekolah Golf Instruksi golf PGA yang tak tertandingi dengan pengalaman 20 tahun di Torrey Pines Pemula: Jika Anda seorang pemula, apakah Anda Wanita, pria, junior, senior, atau memiliki cacat fisik, layanan saya akan membantu Anda mencapai tingkat kenyamanan dengan pengetahuan, kesadaran dan pemahaman tambahan. Saat bermain di kursus, berlatih di tempat atau di manapun di fasilitas golf, faktor intimidasi akan mudah dilakukan. Perantara: Sebagai perantara, Anda akan meningkatkan pengetahuan Anda dan mulai memahami apa yang dilakukan klub Anda terhadap bola dan apa yang dilakukan ayunan Anda kepada klub. Mengubah kejengkelan dan frustrasi menjadi pengetahuan dan pemahaman, jadi Anda menikmati permainan Anda. Pemain yang Selesai: Seperti pemain terlengkap, selesaikan keterampilan Anda dan sertakan kemampuan fisik dan mental untuk meningkatkan permainan Anda ke tingkat berikutnya. Saya cukup beruntung bisa meminta anak perempuan tertua saya untuk membeli sebuah instruksi pelajaran pribadi dari Michael Mayor di Torrey Pines. Sebagai pemain berusia 70 tahun yang baru bermain golf (hacking 4-5 tahun) saya ingin mencoba memperbaiki permainan saya. Michael mencurahkan waktu untuk dasar-dasar ayunan, melempar, meletakkan, pasir dan teknik perbaikan dasar. Yah, saya pasti membaik di semua area dan melihat pukulan jatuh dari nilai saya. Tidak hanya saya perhatikan dan merasakan perbedaannya tapi teman golf saya juga melakukannya. Saya sangat merekomendasikan Michael Major sebagai instruktur dan saya bersyukur atas instruksi yang diberikannya kepada saya.8221 Dr. Bob Stein, San Diego News dari blog Salah satu kekuatan bertahan ISDA adalah partisipasi aktif profesional industri - dan keahlian dan pengetahuannya. Mereka menawarkan - dalam berbagai kegiatannya. Komite Asosiasi, kelompok kerja dan gugus tugas beroperasi di hampir semua pusat keuangan utama dan memainkan peran penting dalam memfasilitasi pertukaran gagasan, pemeriksaan masalah kebijakan, dan arus informasi di antara anggota kami: Anggota ISDA yang terhormat: Seperti kita Memasuki tahun baru, abad baru dan milenium baru, tidak ada kesaksian kuat mengenai representasi efektif ISI mengenai turunan dan industri manajemen risiko daripada kenaikan keanggotaan kami yang terdaftar pada tahun 1999. Sembilan puluh dua organisasi bergabung dengan Asosiasi tahun lalu, membawa Keanggotaan kami untuk lebih dari 450 perusahaan yang berlokasi di 36 negara di lima benua. Asosiasi yang terus tumbuh dalam ukuran dan ruang lingkup sangat penting dalam hal itu datang pada suatu waktu, dan mungkin sebagai hasilnya, dari banyak perubahan yang kita saksikan di pasar keuangan global: pengenalan kerangka peraturan baru, revisi persyaratan kecukupan modal , Konsolidasi dan meningkatnya persaingan antar peserta industri, ketidakpastian ekonomi di daerah-daerah kunci. Di tengah perkembangan ini dan perkembangan lainnya, fokus ISDA yang tajam dan konsisten pada misi utamanya untuk mendorong pengembangan derivatif industri yang dinegosiasikan secara hati-hati dan efisien memungkinkan kita untuk terus memberikan nilai nyata bagi konstituensi global kita. Di bidang manajemen risiko, misalnya, kita menjadi ujung tombak upaya industri untuk merespons secara efektif dan tepat terhadap prakarsa Komite Basel untuk mereformasi kesepakatan modal saat ini. Tiga Kelompok Kerja - Kerangka Konseptual, Penilaian Internal dan Risiko Operasional - menangani isu-isu utama yang diuraikan dalam makalah Basel Committees yang dirilis pada bulan Juni lalu. Partisipasi anggota dalam Kelompok Kerja cukup besar dan meluas, dengan lebih dari empat puluh institusi dari tiga belas negara diwakili. Sebagai bagian dari upaya manajemen risiko kami, ISDA bersama-sama mensponsori dengan British Bankers Association dan Robert Morris Associates sebuah survei terobosan mengenai risiko operasional di lima puluh lima institusi di seluruh dunia. Hasil survei tersebut, yang memastikan bahwa risiko operasional selalu dikelola di lembaga keuangan, namun baru-baru ini dipandang sebagai disiplin terpisah dengan struktur, alat dan proses manajemennya sendiri, telah dipresentasikan kepada Komite Basel, dan akan menjadi Disampaikan kepada otoritas pengatur lainnya dan anggota kami di seluruh dunia. Sepanjang tahun 1999, dokumentasi terus menjadi prioritas utama dalam agenda kami, karena pentingnya mengurangi risiko hukum dan lainnya. Kepemimpinan kami di bidang ini sudah mapan, dan ditingkatkan pada tahun 1999 dengan diterbitkannya Definisi Derivatif Kredit, Panduan Pengguna untuk Pernyataan Opsi FX dan Valas 1998 (diterbitkan bersama oleh ISDA dengan Asosiasi Pedagang Pasar Berkembang dan Komite Devisa ) Dan Panduan Pengguna untuk Dokumen Dukungan Kredit ISDA berdasarkan Hukum Inggris. Pekerjaan juga berjalan dengan baik pada proyek Definisi ISDA 2000 kami, sebuah konsolidasi dari Definisi ISDA 1991, Tambahan 1998 untuk Definisi ISDA 1991 dan Definisi Euro ISDA 1998, yang akan mencerminkan praktik pasar saat ini, terutama mengingat diperkenalkannya Euro dan penghentian sumber suku bunga di 11 mata uang. Dalam persiapan untuk perubahan tahun 2000, kami menyelesaikan tinjauan dokumentasi kami untuk mengantisipasi, menganalisis dan berpotensi menyelesaikan masalah yang dapat timbul sebagai akibat dari masalah Y2K yang akhirnya kami menyimpulkan bahwa tidak ada masalah dokumentasi ISDA utama yang perlu ditangani. Selama tahun lalu, kami memulai tinjauan strategis terhadap dokumentasi kami untuk memastikan bahwa hal itu terus ditangani secara efektif dengan masalah pasar yang dihadapi oleh anggota kami. Proses ini melibatkan pembentukan Satuan Tugas Tinjauan Strategis secara keseluruhan dan empat Kelompok Kerja yang lebih kecil - mengenai Perjanjian Utama Isu-isu struktural Pemutusan, Perhitungan dan Penutupan dan Pemberian Masalah Maju. Masing-masing Kelompok Kerja telah mengembangkan rekomendasi untuk wilayah spesifik mereka, yang telah disahkan oleh Satuan Tugas, dan sekarang menyusun atau mengubah ketentuan untuk dokumen ISDA yang akan ditinjau oleh Komite Dokumentasi ISDA dan anggota lain yang berkepentingan. Untuk mempromosikan kepastian hukum seputar dokumentasi ISDA, sekarang kami memiliki total 34 pendapat hukum mengenai kelayakan ketentuan Jaring Perjanjian ISDA, termasuk lima pendapat baru untuk Jepang, Selandia Baru, Australia, Jerman, dan Belanda yang mencerminkan perubahan dalam Hukum kelautan di yurisdiksi tersebut. Kami juga memperbarui 28 pendapat lainnya. Pendapat hukum mengenai dokumen dukungan kredit ISDA kini telah diperoleh di 12 wilayah hukum sembilan lainnya yang sedang berlangsung dan 10 lainnya telah ditugaskan. ISDA juga bekerja sama dengan European Bank for Reconstruction amp Development dalam menyusun peraturan perundang-undangan netting di Republik Ceko, Hungaria dan Polandia, dan perkembangan positif pada kelambu terjadi di Meksiko dan Argentina melalui upaya ISDA dan anggotanya. Setelah diterbitkan pada tahun 1998 dari Pedoman ISDA untuk Praktisi agunan, kami mengembangkan dan menerbitkan makalah tentang masalah pengelolaan agunan yang lebih kompleks. ISPA 1999 membahas bagaimana program jaminan kolateral dan agunan untuk transaksi derivatif pribadi yang dinegosiasikan selama periode volatilitas pasar pada tahun 1997 dan 1998, dan mengusulkan prakarsa baru untuk meningkatkan efektivitas pengelolaan agunan. Kelompok kerja praktisi telah selesai dan didistribusikan untuk ditinjau oleh saran anggota untuk merampingkan dokumentasi dukungan kredit ISDA yang ada untuk mencerminkan rekomendasi dalam Agunan Jaminan Tahun 1999. Hal ini diharapkan dapat menghasilkan publikasi dokumentasi dukungan kredit yang telah direvisi pada tahun 2000. Komite Collateral kami juga telah melakukan survei eksposur dan praktik jaminan utama yang menangani semua aspek pengelolaan agunan. Survei tersebut mencerminkan tanggapan dari anggota ISDA dan memilih non-anggota dan institusi dengan program jaminan baru atau baru. Grup Reformasi Hukum Jaminan Agunan Amerika membuat langkah-langkah substansial pada tahun 1999. Gambaran umum dan laporan spesifik mengenai masalah hukum agunan di 15 negara (yang mencakup setiap yurisdiksi Uni Eropa) telah selesai. Setelah pekerjaan ini, dan juga pembentukan kelompok kerja terkait agunan dan penetapan isu jaminan sebagai prioritas oleh Komisi Eropa, fokus Grup kami beralih ke pengembangan dan penerapan opsi strategis yang menangani dan menyelesaikan masalah yang telah kami identifikasi. Dua komite baru - Equity Derivatives and Energy Derivatives - dimulai pada tahun 1999. Fokus dari kelompok sebelumnya mencakup item-item seperti dampak integrasi Eropa pada berbagai indeks dan dalam menangani masalah dokumentasi. Pembentukan komite yang terakhir mencerminkan sebagian penambahan sejumlah perusahaan energi ke keanggotaan kami dan minat ISDA dalam memperbaiki lingkungan bisnis, perdagangan dan peraturan untuk transaksi energi. Upaya kami di sini termasuk menyusun Suplemen Energi ke dalam Derivatif Derivatif Komoditas 1993 untuk lebih mencakup pasar energi dan energi, terutama di Eropa. Isu kebijakan publik tetap tinggi dalam agenda anggota dan Asosiasi kami pada tahun 1999, terutama karena kerangka peraturan baru muncul di Eropa setelah diperkenalkannya euro dan di A. S. setelah pencairan Glass-Steagall. Dalam yurisdiksi ini, dan juga orang lain di seluruh dunia, kami mempertahankan profil dan advokasi kepentingan industri yang tinggi. Di Asia, misalnya, ISDA mengadakan seminar sehari-hari mengenai isu-isu terkait kredit untuk regulator Asia di Kuala Lumpur pada bulan Maret yang diprakarsai oleh Otoritas Moneter Hong Kong dan diselenggarakan oleh Bank Negara Malaysia. Sekitar enam puluh regulator mengambil bagian, mewakili pasar keuangan Australia, China, Hong Kong, Indonesia, Jepang, Korea, Malaysia, Selandia Baru, Filipina, Singapura dan Thailand. Keberhasilan seminar ini menyebabkan penjadwalan pada bulan Oktober forum setengah hari mengenai manajemen risiko untuk regulator Asia di Singapura yang diselenggarakan oleh ISDA dan Otoritas Moneter Singapura. Regulator dari Jepang, China, Hong Kong, India, Indonesia, Malaysia, Thailand dan Singapura hadir. Upaya penjangkauan anggota kami juga mengambil dimensi baru, karena kami mengadakan lebih banyak konferensi dan pertemuan anggota di lebih banyak lokasi daripada sebelumnya: Eropa Barat dan Timur, Timur dan Asia Tenggara dan Australia, Afrika Selatan dan Amerika. Kami mengadakan, misalnya, seminar pertama kami di China dan Korea tahun lalu. Sesi ini memainkan peran penting dalam mendidik industri dan lainnya dalam perkembangan industri dan inisiatif Asosiasi, dan tanggapan anggota kami terus menjadi antusias. Sebagai hasil dari tuntutan anggota dan prakarsa berkelanjutan kami di seluruh dunia, menjadi jelas bahwa representasi efektif industri kami mengharuskan kami membangun kehadiran di wilayah-wilayah kunci dan pasar keuangan. Inilah sebabnya mengapa beberapa tahun yang lalu kami menambahkan sebuah kantor di Eropa, yang berbasis di London, yang melengkapi karya kantor pusat New York. Itulah sebabnya kami akan membuka kantor ISDA Tokyo pada tahun 2000. Jumlah komite dan tingkat pekerjaan yang dilakukan oleh anggota Jepang kami telah meningkat pesat, dan kantor Tokyo kami akan memainkan peran penting dalam memfasilitasi dan memimpin kegiatan kami di sana. Kami juga ikut serta dalam perencanaan kami untuk membuka kantor di Hong Kong atau Singapura pada tahun 2000. Sementara kegiatan dan wilayah geografis di mana ISDA terlibat sangat luas dan tersebar luas, strategi dasar kami tetap sangat terfokus. Pertama, kami tetap berkomitmen untuk memenuhi misi kami: mendorong pengembangan bisnis derivatif pribadi yang bijaksana dan efisien, serta pengembangan dan pemeliharaan praktik pengelolaan risiko yang baik. Kedua, kita tetap menjadi organisasi berbasis anggota, yang strategi dan arahannya didorong oleh perusahaan anggota kita. Dan ketiga, kami tetap yakin bahwa efektivitas dan kesuksesan kami pada akhirnya disebabkan oleh partisipasi dan keterlibatan aktif individu di perusahaan tersebut. Sifat internasional ISDA juga tercermin dalam komposisi Dewan Direksi yang diambil dari dua puluh dua perusahaan anggota dari 10 negara. Dewan memberikan arahan strategis yang kuat untuk Asosiasi sepanjang tahun dan anggota individu memainkan peran kepemimpinan penting dalam kegiatan dan proyek komite. Anggota dewan yang menjabat pada kuartal ketiga tahun 1999 tercantum di bawah ini. Anggota Dewan lainnya yang masa jabatannya berakhir pada tahun 1999 adalah Joseph Bauman dari Bank of America, Mark Brickell dari J. P. Morgan, Tsuyoshi Hase dari Industrial Bank of Japan, dan Mark Wallace dari SBC Warburg Dillon Read. Charles Smithson dari CIBC World Markets dan Dirk Brouwer dari Trinkhaus amp Burkhardt KgaA juga mengundurkan diri dari Dewan selama tahun tersebut. ISDA sangat berterima kasih atas usaha mereka atas nama industri dan Asosiasi. Tahun ini juga melihat penguatan signifikan staf ISDA. Ukuran dan kemampuan kantor ISDA Eropa terus berkembang. Saya senang menunjuk Nick Collier ke jabatan Direktur Kebijakan Eropa dan Kepala Kantor Eropa. Saya juga senang bisa masuk ke kantor Eropa Emmanuelle Sebton sebagai Direktur Manajemen Risiko dan Richard Metcalfe sebagai Asisten Direktur Kebijakan Eropa. Di Amerika Utara, saya sama-sama senang menyambut Ruth Ainslie ke peran Direktur Senior Kebijakan untuk Amerika dan Hubungan Media, Stacy Carey sebagai Direktur Kebijakan Regulasi A. S. dan Roseanne Stanzione sebagai Asisten Direktur Kebijakan untuk Amerika. Upaya staf profesional ISDA dan konsultan luar kembali tercermin dalam pencapaian tahun 1999 dan saya ingin mengucapkan terima kasih atas dedikasi dan kerja keras mereka. Matthew Elderfield, yang menjabat sebagai kepala kantor ISDA Eropa, mengundurkan diri dari Asosiasi pada bulan Mei 1999 untuk menerima posisi sebagai Kepala Bursa dan Rumah Kliring untuk Otoritas Jasa Keuangan Inggris. ISDA berterima kasih kepada Matthew selama bertahun-tahun kepemimpinannya dalam usaha ISDA Eropa. Kami berharap dia sukses dalam peran barunya. Atas nama Dewan Direksi dan staf kami, saya mengucapkan terima kasih atas keanggotaan Anda di ISDA. Kami akan terus melakukan semua yang kami bisa di tahun yang akan datang untuk memastikan dukungan Anda, meningkatkan komitmen Anda dan mendorong partisipasi Anda dalam pekerjaan Asosiasi. Hormat kami, Direktur Eksekutif dan Chief Executive Richard E. Grove Sepanjang tahun 1999, ISDA melanjutkan upayanya untuk memperbarui anggota mengenai isu-isu industri utama di berbagai bidang seperti manajemen risiko, dokumentasi, peraturan, pajak, akuntansi, pasar negara berkembang dan implementasi EMU. Peningkatan penggunaan komunikasi elektronik, situs internet ISDA dan buletin ISDA dua bulanan memungkinkan Asosiasi untuk terus menginformasikan keanggotaannya dan terlibat secara efisien sepanjang tahun. Sepanjang tahun, direksi dan staf ISDA memberikan presentasi di seminar dan pertemuan pembaruan anggota yang mencakup berbagai topik di yurisdiksi termasuk Australia, Austria, Belgia, Kanada, China, Republik Cheska, Denmark, Finlandia, Prancis, Jerman, Hongaria, India, Irlandia, Italia, Korea, Malaysia, Norwegia, Polandia, Portugal, Singapura, Afrika Selatan, Swedia, Swiss, Thailand, Inggris dan Amerika Serikat. Dengan prospek kantor baru di Tokyo dan Asia Tenggara pada tahun 2000, tingkat layanan yang ditawarkan oleh Asosiasi hanya akan meningkat di tahun-tahun mendatang. Manfaat anggota Asosiasi, tingkat aktivitas dan pentingnya isu yang ditangani ISDA pada tahun 1999 terus mendorong peningkatan keanggotaan yang signifikan. Sembilan puluh dua anggota baru bergabung dengan Asosiasi tahun lalu, termasuk yang pertama dari India. Keanggotaan ISDA sekarang berjumlah lebih dari 460 lembaga keuangan, entitas pemerintah, perusahaan dan penyedia layanan profesional dari 36 negara. Anggota baru mencerminkan sebagian pertumbuhan swap dan aktivitas derivatif lainnya di bidang energi, asuransi dan pasar negara berkembang. Selama tahun 1999, Komite dan Satgas yang dioperasikan oleh ISDA di masing-masing bidang berikut: Akuntansi dan Pengungkapan Manajemen Jaminan Dokumentasi Derivatif Komoditas Pasar Berkembang Derivatif Derivatif Derivatif Ekuitas Perumusan Pasar Moneter Eropa Peraturan Operasional Manajemen Risiko dan Pajak, serta komite lokal di Afrika Selatan , Asia Tenggara dan Hong Kong, Jepang, dan Kanada. Pada tahun 1999, ISDA menyambut baik institusi berikut sebagai anggota baru: Anggota Utama (27): African Merchant Bank Limited Lazard Brothers amp Co. Limited Di antara kegiatan ISDA di kawasan Asia Pasifik pada tahun 1999 adalah dua seminar mengenai manajemen risiko bahwa ISDA Diadakan untuk regulator daerah. Seminar pertama, yang diprakarsai oleh Hong Kong Monetary Authority dan diselenggarakan oleh Bank Negara Malaysia, diadakan di Kuala Lumpur pada bulan Maret dan mencakup isu-isu terkait kredit. Seminar tersebut dihadiri oleh sekitar enam puluh regulator dari Australia, China, Hong Kong, Indonesia, Jepang, Korea, Malaysia, Selandia Baru, Filipina, Singapura dan Thailand. Topik yang dibahas meliputi analisis dan manajemen risiko kredit, dokumentasi sebagai teknik mitigasi risiko kredit, praktik agunan, aplikasi derivatif kredit dan pedoman kecukupan modal untuk risiko kredit. Peserta ISDA termasuk perwakilan anggota ISDA dan staf dari Singapura, Hong Kong, Tokyo, London dan New York. Seminar kedua, yang diselenggarakan oleh Otoritas Moneter Singapura (MAS), diadakan pada bulan Oktober di Singapura. Topik yang dibahas dalam seminar meliputi risiko pasar, risiko kredit, risiko operasional dan risiko hukum. Regulator dari berbagai pasar hadir, termasuk China, Hong Kong, India, Indonesia, Jepang, Malaysia, Singapura dan Thailand. Kelompok ISDA terdiri dari anggota dewan, staf dan perwakilan perusahaan anggota dari New York, London, Tokyo, Frankfurt, Amsterdam, Singapura dan Hong Kong. ISDA aktif selama tahun 1999 dalam mengomentari inisiatif peraturan di seluruh wilayah. Di antara proposal yang dikemukakan oleh ISDA adalah pedoman MASs yang diusulkan untuk derivatif yang digunakan oleh perusahaan asuransi, Reserve Bank of Indias mengusulkan pedoman yang mengotorisasi transaksi perjanjian forward rate dan swap suku bunga dalam bentuk rupee dan Bank Negara Malaysias mengusulkan pedoman yang berkaitan dengan penggunaan Derivatif oleh perusahaan asuransi Malaysia. ISDA juga mengomentari beberapa proposal kecukupan modal yang berkaitan dengan derivatif kredit yang dikeluarkan oleh regulator regional, termasuk Australia dan Hong Kong. ISDA juga secara aktif memantau sejumlah perkembangan hukum lainnya di wilayah ini selama tahun 1999. Ini termasuk proses pengadilan yang berkaitan dengan interpretasi Perjanjian Induk ISDA setelah pembubaran Peregrine di Hong Kong dan beberapa kasus pengadilan terkait dengan penerapan kontrak derivatif di Indonesia. Perhatian khusus terhadap ISDA dan anggotanya adalah proses likuidasi yang berkaitan dengan Guangdong International Trust and Investment Corporation (GITIC) di China. Komite likuidasi GITIC mengeluarkan keputusan sementara yang menolak klaim derivatif tertentu yang diajukan oleh kreditur GITIC atas dasar bahwa GITIC telah gagal mendapatkan otorisasi yang benar dari Administrasi Luar Negeri China untuk menjamin terjadinya SAFE sebelum melakukan transaksi. Para pengadu dapat mengajukan keberatan atas keputusan tersebut dan, sampai akhir tahun, keputusan final atas keberatan tersebut belum dikeluarkan. Pada bulan November, ISDA mengajukan surat kepada Bank Rakyat China dan SAFE yang meminta agar mereka mengatasi ketidakpastian hukum yang diajukan oleh proses GITIC. ISDA juga mengadakan sejumlah pertemuan dengan regulator dan pelaku pasar di wilayah tersebut selama tahun 1999. Pada bulan Januari, sebuah delegasi ISDA mengunjungi India dan memberikan presentasi mengenai isu-isu derivatif dan manajemen risiko di Mumbai. Pada bulan Maret, perwakilan ISDA mengunjungi anggota dan regulator di Australia, Singapura dan Malaysia. Pada bulan Mei, sebuah tim ISDA mengadakan seminar di China dan Korea mengenai dokumentasi ISDA dan isu-isu manajemen risiko. Pada bulan Oktober, tim ISDA mengunjungi Singapura, Malaysia, Thailand dan India. ISDA juga mengadakan Update Regional Asia-Pasifik tahunan di bulan Oktober di Singapura. Pembicara utama pada update Singapura adalah Tharman Shanmugaratnam dari Monetary Institute of Singapore. Upaya ISDA di wilayah ini terus dipimpin oleh anggota Komite Pengarah Asia Tenggara dan berbagai subkomite yang bekerja di bawah Komite Pengarah. Panitia terus sering bertemu di Hong Kong dan Singapura dan menarik dukungan administratif dari kantor perwakilan yang berlokasi di Hong Kong. Menjelang akhir tahun, Dewan ISDA menyetujui sebuah proposal untuk mendirikan sebuah kantor ISDA penuh di Asia Tenggara selama tahun 2000. Kantor ISDA, yang akan berlokasi di Singapura atau Hong Kong, akan memberikan dukungan kepada ISDAs South East Komite Pengarah Asia dan subkomite dan anggota regional ISDA. Kantor tersebut akan bertanggung jawab untuk mengkoordinasikan kegiatan ISDA untuk Asia Tenggara, China dan Korea Australia dan Selandia Baru dan India. Kantor tersebut akan dikelola awalnya oleh dua anggota staf ISDA penuh-waktu. Pembukaan tersebut ditetapkan pada bulan Oktober 2000. KOMITE ANGGOTA CANADIAN Komite Anggota ISDA Kanada terus berfokus pada isu-isu yang menjadi perhatian khusus anggota ISDA Kanada. Di pertengahan tahun, Ontario Securities Commission (OSC) mengeluarkan sebuah laporan oleh Task Force on Debt-Like Derivatives, yang mencakup peraturan dan kebijakan yang diusulkan. ISDA mengajukan surat komentar ke OSC yang menunjukkan pandangan anggota Kanada bahwa peraturan yang diusulkan akan menghambat pasar untuk produk hutang terstruktur yang populer di kalangan investor Kanada. Dalam surat komentarnya, ISDA menunjukkan bahwa tidak ada bukti adanya masalah di pasar untuk instrumen ini saat ini dan, karena itu, tidak memerlukan intervensi legislatif. ISDA mendesak sebuah peraturan daripada tanggapan legislatif dan memberikan saran khusus untuk perbaikan dalam proposal tersebut. Pada bulan Juli, ISDA dan anggotanya terkejut dengan amandemen undang-undang sekuritas di Alberta yang memperluas definisi sekuritas dengan cara yang tampaknya mencakup transaksi derivatif pribadi yang dinegosiasikan. Sementara peserta industri merasa lega dengan mendapatkan pengecualian dari undang-undang tersebut, tetap ada kekhawatiran tentang pendekatan yang akan diadopsi oleh regulator provinsi lainnya, seperti British Columbia Securities Commission (BCSC). Kemudian di tahun ini, bantuan membebaskan BCSC dari cakupan tindakan sekuritas provinsi untuk berbagai derivatif OTC. Kelegaan itu semakin jauh dari yang diberikan di Alberta. Asosiasi terus bekerja sama dengan BCSC dan komisi sekuritas provinsi lainnya untuk mencapai perlakuan terhadap transaksi derivatif OTC yang mencerminkan secara benar sifat unik mereka dan meningkatkan kepastian hukum. Pada bulan Juni, pengadilan Kanada memutuskan bahwa kontrak non-ISDA tertentu yang mengatur transaksi yang mempertimbangkan pengiriman fisik tidak memenuhi syarat kontrak keuangan berdasarkan undang-undang kepailitan Kanada. Sementara kontrak yang terlibat dalam kasus ini bukan kontrak ISDA, ketentuan penutupan yang relevan didasarkan pada kesepakatan Master ISDA. Ada keputusan sebelumnya oleh hakim pengadilan bahwa transaksi tunai yang diselesaikan berdasarkan Perjanjian Induk ISDA berhak atas manfaat undang-undang kepailitan Kanada. Kasus tersebut, yang melibatkan Blue Range Resources Corporation, saat ini mendapat pengajuan banding, dan persidangan ditetapkan pada kuartal pertama tahun 2000. ISDA telah mendapat cuti untuk campur tangan dalam banding tersebut dan bekerja sama dengan anggota Kanada untuk menentukan cara terbaik di mana Untuk memberi dukungan. GARIS BESAR PASAR GERAKAN Pasar Berkembang Eropa ISDAs European Emerging Markets Task Force didirikan pada tahun 1997 untuk fokus pada isu-isu penting untuk pengembangan pasar derivatif di Republik Ceko, Hungaria, Polandia dan Rusia, dan untuk bekerja dengan peserta lokal dan pemerintah daerah untuk Mempromosikan kepastian hukum, terutama di tiga wilayah peraturan perundang-undangan, dokumentasi lokal, dan peraturan yang tepat. 1999 melihat kemajuan di bidang ini di tiga negara di mana ISDA telah berkonsentrasi. Setelah melakukan diskusi dengan Tim Transisi Hukum Bank Pembangunan untuk Rekonstruksi dan Pembangunan Eropa (EBRD) pada tahun 1999, telah disepakati bahwa EBRD akan melibatkan ISDA (bersama dengan Allen amp Overy) sebagai konsultan dalam menyusun undang-undang netting sampai lima Eropa Tengah dan Timur Negara. Ini merupakan langkah yang disambut baik oleh EBRD, yang sudah mendukung kerja ISDA di bidang ini. Mudah-mudahan, dukungan EBRDs akan mendorong pemerintah yang bersangkutan untuk mengenali urgensi masalah ini. Dalam sebuah acara besar untuk mengakhiri tahun ini, ISDA dan EBRD menyelenggarakan sebuah seminar di Praha pada bulan Desember, dengan fokus pada pentingnya jaring di pasar derivatif, dimana Asosiasi mengundang sejumlah besar pelaku pasar lokal dan pejabat. Seminar dilanjutkan pada hari berikutnya dengan pemutakhiran umum tentang kegiatan ISDA. Kedua acara tersebut dihadiri oleh para bankir, bankir, regulator, dan pejabat kementerian luar negeri tidak hanya dari Polandia, Hungaria dan Republik Ceko, namun juga dari Slovakia dan negara-negara Eropa lainnya. Pada awal tahun 1999, ISDA mengunjungi perwakilan Bank Nasional, Kementerian Keuangan, Komisi Sekuritas dan Asosiasi Perbankan Ceko, serta praktisi pasar untuk membahas masalah hukum dan peraturan yang relevan dengan pasar derivatif di Republik Ceko. Diskusi difokuskan pada makalah advokasi ISDA yang menguraikan argumen yang mendukung undang-undang tentang kelambu, dengan anggota ISDA aktif, termasuk EBRD, dan juga pelaku pasar lokal, mendesak pejabat pemerintah Ceko untuk mendukung pembuatan dan adopsi undang-undang netting yang telah ditutup. Akibatnya, selama tahun 1999, Financial Markets Association (FMA), yang mencakup National Bank, mengembangkan undang-undang netting rancangan. ISDA meninjau draft yang diajukan melalui Allen amp Overy, penasihat hukum Eropanya, dan diharapkan parlemen Ceko akan mengubah undang-undang tentang Kebangkrutan dan juga Securities Act untuk memungkinkan dilakukannya transaksi derivatif berdasarkan Perjanjian Utama ISDA pada tahun 2000. FMA juga telah menyatakan antusiasme untuk pengembangan dokumentasi derivatif lokal standar, mungkin sejalan dengan model Hungaria yang dibahas di bawah ini. Secara terpisah, Bank Nasional meminta agar ISDA membantu dalam mengembangkan program pelatihan risiko pasar untuk staf pengawasnya. Pada bulan Agustus, bersama dengan KPMG dan dukungan dari Kantor Pertukaran Informasi Bantuan Teknis Komisi Eropa (TAIEX), ISDA mengadakan kursus pelatihan untuk memberikan pengenalan metode standar dalam EU Capital Adequacy Directive (CAD) dan juga risiko terkait. Masalah manajemen seperti nilai internal pada model risiko, dibahas dalam manual amandemen amandemen selanjutnya. Pada tahun 1999, Hungaria Forex Association menyelesaikan pengembangan standar, bahasa Inggris, dokumentasi lokal untuk digunakan di pasar derivatif Hungaria. Meskipun ini bukan dokumen ISDA, ISDAs Task Force memiliki kesempatan untuk meninjau draf dokumentasi sebelum dipublikasikan. Dokumentasi, yang disusun sebagian besar oleh Allen amp Overy, kompatibel dengan dokumentasi standar pasar ISDA yang ada, dengan menggunakan suplemen lokal sesuai dengan definisi ISDA Master Agreement dan ISDA, dan diterbitkan pada bulan Mei 1999. Satuan Tugas mendukung usaha-usaha dari Industri Hungaria dalam mengembangkan dokumentasi lokal yang bisa digunakan juga untuk perdagangan lintas batas. Diharapkan bahwa industri Ceko dan Polandia akan mengikuti dan mendorong dokumentasi lokal dan ISDA mereka sendiri yang kompatibel. ISDA telah mengetahui bahwa kementerian keuangan dan bank sentral mendukung termasuk definisi jaring pengaman di dalam undang-undang reformasi pasar modal. Advokasi lebih lanjut masih diperlukan, namun ISDA berharap dapat bekerja sama dengan pemerintah daerah dan industri untuk mulai menyusun undang-undang dengan dukungan finansial dari EBRD. Selanjutnya pada seminar pada bulan September 1998 tentang prinsip-prinsip manajemen risiko, Asosiasi Perbankan dan Forex Polandia telah mengikuti sebuah proyek dokumentasi lokal dan juga tertarik untuk mendesak penerapan undang-undang netting. Pada bulan Desember 1999, berdasarkan permintaan dari TAIEX, ISDA mengadakan seminar untuk bank nasional Polandia yang menguraikan pelaksanaan transaksi derivatif, swap dan pembelian kembali. Kunjungan tambahan ke Warsawa untuk membahas lebih lanjut dengan pelaku pasar dan badan pengatur kebutuhan untuk memperkenalkan peraturan perundang-undangan netting direncanakan untuk tahun 2000. Sepanjang tahun 1999, ISDA melanjutkan dialognya dengan legislator dan regulator Argentina dan Meksiko. Perkembangan terakhir di kedua yurisdiksi ini telah menggembirakan. Di Argentina, perubahan pemerintahan telah menunda penerapan undang-undang kebangkrutan yang telah direvisi, yang pada awalnya diusulkan pada akhir tahun 1998, yang menangani penghentian kontrak secara otomatis dan penjangkauan neto jika terjadi kebangkrutan. Kementerian Kehakiman telah mengajukan sejumlah amandemen undang-undang yang diusulkan (Ley No. 24.522 Ley de Concursos y Quiebras) yang diharapkan Kongres baru akan mempertimbangkannya setelah reses legislatifnya. Kongres Meksiko telah memberlakukan undang-undang (Ley de Concursos Mercantiles) yang menangani masalah kebangkrutan pada umumnya dan mencakup ketentuan yang mengatur penghentian kontrak secara otomatis dan penjangkauan neto jika terjadi kebangkrutan. Tampaknya ada dukungan legislatif yang luas untuk RUU tersebut dan diharapkan segera disahkan menjadi undang-undang. Masalah agunan berada di puncak agenda ISDA di Jepang pada tahun 1999. Awal tahun, ISDA membentuk sub komite agunan di bawah Komite Operasi Tokyo-nya. Pertemuan pertama sub komite pada bulan Februari dihadiri oleh sekitar lima puluh pelaku pasar. Diskusi difokuskan pada masalah operasional yang berkaitan dengan pengalihan agunan Jepang. Pertemuan kedua sub komite (nanti di musim semi) dikhususkan untuk diskusi tentang masalah hukum seputar penggunaan agunan di Jepang. Selama musim panas, sub-komite diangkat ke status komite penuh di bawah pimpinan anggota Dewan ISDA Shigeru Asai dari Sanwa Bank. Komite menetapkan tujuannya untuk meningkatkan penggunaan agunan untuk mengurangi risiko kredit dan penetapan pedoman untuk mengelola program agunan di Jepang. Pada bulan Oktober, Komite Jaminan mensponsori serangkaian pertemuan dengan anggota ISDA, Bank of Japan (BOJ) dan Japan Financial Supervisory Agency (FSA) untuk membahas agunan dan derivatifnya. Michael Clarke dari JP Morgan, ketua bersama Komite Jaminan Global ISDA, dan Susan Hinko, Direktur Kebijakan ISDA untuk Amerika, membuat presentasi mengenai perkembangan global dalam collateralization, manfaat dan risiko agunan, kerangka hukum dan peraturan untuk agunan. Dan pedoman modal Basel Committees yang berkaitan dengan agunan. Mereka juga membahas jenis infrastruktur organisasi yang diperlukan untuk memastikan operasi manajemen agunan yang profesional dan efisien. Komite Dokumentasi Tokyo ISDA juga aktif selama tahun 1999. Kelompok Kerja Definisi FX yang dibentuk oleh Komite mulai berkolaborasi dengan Komite Pasar FX Tokyo untuk Panduan Pengguna Bahasa Jepang untuk Pernyataan Opsi FX dan Mata Uang 1998. The guide will not be a direct translation of the English version but will explain in plain Japanese such new concepts as Disruption Events and Non-Deliverable FX. Activities of the ISDA Tokyo Operations Committee in 1999 included discussions on how to deal with negative interest rates. These discussions focused on such systems issues as automated calculation, mark-to-market accounting and cash flow information. The Operations Committee also discussed the introduction and status under Japanese law of fax confirmations. During 1999, ISDA established a Tokyo Regulatory Committee under the chairmanship of Tsuyoshi Hase of IBJ-Nomura, a former ISDA Board member. The Committee set up three subcommittees. The first is the Tax and Accounting Subcommittee, which has focused on Japanese accounting developments, particularly the introduction of mark-to-market accounting for the banking book. The second is the Legislative Committee, which initially concentrated on the Japanese Financial Services Act. The third is the Capital Adequacy Subcommittee, which focused on the Basel Committee Capital Accord Reform process. ISDA held several meetings with Japanese regulators during the year to discuss issues of mutual interest. In April, Rick Grove, ISDA CEO, and ISDA Board members Teruo Tanaka of IBJ and Shigeru Asai of Sanwa Bank met with the BOJ. The same ISDA representatives, joined by ISDA Chairman Mark Harding and several other North American and European-based ISDA Directors and staff members, made a follow-up visit to the BOJ in October. At the same time, the group visited the FSA and the Ministry of Finance. Discussions concentrated on Japans Big Bang, the reform of the Basel capital accord and ISDAs activities in Japan and elsewhere around the world. ISDA held two other important meetings with Tokyo-based members in 1999. In April, ISDA representatives met with Japanese members to discuss anticipated future developments in derivatives activity and risk management. In October, ISDA held its annual Tokyo members update over a two-day period. The first day consisted of specialist briefings relating to Japanese regulatory and legislative changes, credit derivatives documentation, collateral, tax and accounting. The second day included an overview of ISDAs global documentation, risk management, collateral, accounting and market practice issues. The keynote regulatory address was delivered by Masaaki Shirakawa, advisor to the Governor of the BOJ. Toward the end of the year, the ISDA Board approved a proposal to establish a full ISDA office in Tokyo during the year 2000. The ISDA Tokyo office will provide support to ISDAs Tokyo committees and ISDAs Tokyo-based members. The office will be staffed initially by two full-time ISDA staff members. The opening is set for April 13. Strategic Documentation Review In June 1999, ISDA began a comprehensive review of certain key aspects of its standard-form documentation. The project, called the ISDA Strategic Documentation Review, is being undertaken to ensure that ISDAs documentation continues to reflect both developing market practice and the experiences of industry practitioners during periods of market stress experienced in late 1997 and throughout 1998. Throughout 1999, four working groups focused on issues of termination, valuation and close-out force majeure master agreement structural issues and collateral documentation. Each of the working groups is comprised of senior legal staff from member firms having particular expertise in ISDA documentation. In relation to the work done on collateral documentation, which followed on from the recommendations contained in the ISDA 1999 Collateral Review, see the section on Collateral Management, below. Each of the other three areas of discussions are considered in turn below. Pending publication of an amended ISDA Master Agreement, it is intended that a protocol mechanism will be established to implement on a multilateral basis the amendments resulting from the project. Termination, Valuation and Close-out Working Group The focus of this working group is Sections 5 and 6 of the ISDA Master Agreement. During recent periods of market stress, it became clear that, although legally robust, the Market Quotation payment measure contained in the ISDA Master Agreement may not be sufficiently flexible in a crisis situation. The mechanism requires that quotations be obtained from at least three Reference Market-makers. During periods of market stress, this can prove difficult in the cases of large or illiquid portfolios. The working group is seeking to develop a more flexible approach, allowing parties to draw on a wide range of market information, including, where reasonable, the use of data produced internally to determine replacement values for transactions accurately and on a timely basis. The working group is also reviewing the Events of Default and Termination Events set out in the Agreement to assess whether it would be appropriate to shorten cure periods and other relevant timeframes. Force Majeure Working Group Recent periods of market turmoil also accentuated the importance of clarifying the effect of impossibility or force majeure events on the contractual obligations of parties to an ISDA Master Agreement. Although it contains provisions addressing Illegality, the ISDA Master Agreement does not currently address impossibility or force majeure. This working group is developing a suitable provision and assessing appropriate cure and waiting periods. Similar work has been being undertaken by the Foreign Exchange Committee of the Federal Reserve, and efforts are being made to coordinate approaches. Master Agreement Structural Issues Working Group The goal of this working group is to develop a legally robust and practical means by which industry participants can take greater advantage of cross-product netting. The working group is considering three means of achieving this: first, the working group is considering the development of bridges to other master agreements such as the Global Master Repurchase Agreement produced by the Bond Market Association (TBMA) and the International Securities Market Association. Similar bridges were prepared by ISDA in 1996 to enable parties to draw transactions executed under the FRABBA and BBAIRS provisions prepared by the British Bankers Association into their ISDA Master Agreements. Secondly, the group is considering the practicalities of a master-master agreement approach to cross-product netting. This is an area in which TBMA is undertaking a considerable amount of work. ISDA, through its external counsel, has commented on exposure drafts of a master netting agreement produced by TBMA and will continue to examine their efforts going forward, with a view to endorsing any suitably robust document. Thirdly, the group is looking to develop a single broad-ranging master agreement that would enable parties to document a broader range transactions, including repurchase transactions, under a single agreement. Most recently, the working group has focused on the development of bridges. However, ISDA considers that these bridges will be a temporary measure. The longer-term, permanent solution will be a broad-ranging single master agreement. 2000 ISDA Definitions Through the substantial efforts of a small working group and a larger task force in the latter part of 1999, the Association pursued its goal of publishing a revised set of definitions for interest rate and currency swap transactions. The product of these efforts will be called the 2000 ISDA Definitions and will combine the 1991 ISDA Definitions, the 1998 Supplement to those definitions and the 1998 Euro Definitions to create a document that will hopefully stand the test of time as well as the original 1991 ISDA Definitions has. The group is focusing on issues such as cash settlement, where it is seeking to reflect the experience of market participants in using the existing cash settlement provision while anticipating the likelihood that market practice in that area will continue to evolve in the coming years. ISDA expects to complete this project in the first quarter of 2000. 1999 ISDA Credit Derivatives Definitions In July, the Association published the 1999 ISDA Credit Derivatives Definitions. The Definitions, which are intended to facilitate the documentation of credit default transactions, have quickly gained broad market acceptance. The Definitions provide parties to credit default transactions with a shorter, more convenient means of documenting their transactions, replacing long-form confirmations based on the form ISDA published over two years ago. In addition to streamlining the documentation of individual transactions, the Definitions provide greater certainty of terms, more flexibility in tailoring specific provisions and wider coverage of underlying obligations. One of the principal aims of the Association in developing the definitions was to promote legal certainty in the market for credit default products. It is hoped that this has been achieved through the production of objective definitions, most clearly evident in the revised definition of the Restructuring Credit Event. Work on a users guide to the Definitions is well under way and should be completed by the end of the first quarter of 2000. The users guide will not only include detailed explanation of the provisions in the Definitions, but will also address other issues that were considered in the course of drafting the definitions. Work on additional credit derivative product areas in also in the Associations future documentation plans. Year 2000 Review of ISDA Documentation The Association worked with the Financial Markets Lawyers Group and with the Global Year 2000 External Risk Mitigation and Contingency Planning Committee to consider Y2K date change issues that may affect the financial markets. The ISDA Year 2000 Review of Standard Documentation represented one aspect of ISDAs efforts in this regard. Like a number of other financial markets industry associations, ISDA conducted an extensive review of its standard-form documentation with a view to highlighting any provisions of which industry participants should be particularly aware in light of the Y2K date change problem. It also contained a summary of ISDAs Business Day Conventions and reproduced the Global 2000 calendar of local market closures around the millennium period. Having undertaken the review process, the Association was able to conclude with certainty that there were no Y2K time bombs buried in its documentation. NETTING AND COLLATERAL OPINIONS Mitigation of risk through the use of netting and collateralization continued to be a central consideration for the Association throughout 1999. Both the Strategic Documentation Review and the efforts of the ISDA Collateral Committee focused considerable efforts on these area during the year. A further manifestation of this focus was the expansion of the Associations efforts to collect opinions on the enforceability of the ISDA credit support documents and the close-out netting provisions contained in the ISDA Master Agreement. At the end of 1999, a netting opinion for the Bahamas was commissioned. This will bring the total number of jurisdictions from which netting opinions have been obtained to thirty-five. Revised opinions were obtained to reflect newly enacted netting legislation in Australia, Germany, Japan, the Netherlands and New Zealand. Opinion updates from thirty-one jurisdictions were solicited during the year and have been delivered to members. The Associations collateral opinion project, which began in 1997, is continuing to grow to meet the needs of ISDA members. Collateral opinions have now been acquired from a total of fourteen jurisdictions. In 1999, opinions from France, Germany, Hong Kong and Thailand were distributed to members and opinions from Italy, the Netherlands, Portugal and Spain are under consideration. Additionally, the Association plans to commission collateral opinions from Australia, Austria, Bermuda, Denmark, Finland, Ireland, The Netherlands Antilles, Norway, South Africa and Sweden in 2000. ISDA is continuing to research ways in which available technology can be used to deliver netting and collateral opinions to members more promptly and in a medium that would allow members to distribute the opinions more easily to interested parties within their organizations. In 2000, ISDA began to deliver its opinions by e-mail, in addition to hard copy form. ISDA placed a strong emphasis on risk management in 1999, following the announcement by the G10 Basel Committee of Banking Supervisors of a major review of international capital adequacy standards and the issue of a parallel consultation paper by the European Commission. The Basel Committee consultation paper was a welcome development and followed an active campaign by ISDA to raise awareness of the flaws of the 1988 Capital Accord, which culminated in the publication of ISDAs paper on credit risk capital reform (Credit Risk and Regulatory Capital, March 1998). ISDA considers the on-going Capital Accord review to be an excellent opportunity to ensure that regulatory capital is more closely aligned with banks economic capital and, in particular, to secure an incentive-compatible treatment of credit risk mitigation instruments. It is of the utmost importance that regulators apply charges that are directionally consistent with the risks that they are trying to capture. Of equal importance however is the need for a fundamental re-think of the rationale for applying minimum capital charges. ISDA believes that for some categories of risk, most prominently operational risk and interest rate risk in the banking book, applying minimum capital requirements is not the correct approach. As a complement to its Basel review initiative, ISDA also carried out in-depth studies of operational risk practice and credit risk modelling. These initiatives, launched jointly with other trade associations, have greatly contributed to improving the expertise of member firms in the fields concerned, and will, it is hoped, be useful to regulators. Reform of the Basel Accord To address the many issues raised by the Capital Accord review, ISDA set up three working groups under the oversight of a Capital Accord Steering Committee. More than 40 firms, representing 13 countries were involved in the response process: The CFWG considered the adequacy of the overall framework proposed by the Basel Committee, notably the soundness standard underpinning the regulatory capital requirements and the suitability of applying minimum capital charges against the various forms of risk envisaged by the Committee. The IRWG structured a matrix of credit risk capital charges, and proposed methodologies for attaining a more appropriate treatment of credit risk mitigation. The ORWG drew on banks of different types from a number of jurisdictions and focused on the appropriateness of a minimum charge for operational risk, as distinct from the process of supervisory review. As with other aspects of ISDAs response, the prime concerns were the risk-sensitivity of any regulatory treatment and the incentives it embodied. This work also entailed extensive regulatory liaison, which is set to continue in 2000. ISDA concluded that the regulators ought to promote the following principles in the new capital adequacy framework: Clarity . The assumptions underlying the new framework should be made explicit where this is possible. For instance, the horizon set for holding capital (equivalent to the holding period retained in the trading book rules), as well as the loss percentile assumed, should be clearly defined. This is a pre-requisite for establishing a consistent, incentive-compatible framework, particularly since relying on portfolio risk models in the longer-term future is envisaged. ISDA suggests retaining 99th percentile loss over a one year horizon as a basis for setting capital requirements. This would ensure that capital charges constitute a maximum insolvency standard that is non-constraining for well managed banks. Economic consistency: Regulatory capital charges should be aligned more closely with banks economic capital, and certainly be directionally consistent with it. They should for this purpose be sensitive to the same risk drivers that govern economic capital variations. The current Accord fails this test. ISDA has identified a range of key factors, and derived capital requirements based on these factors. For instance, credit risk charges are dependent on the tenor of the exposure, the default probability of the issuer, the loss given default on the facility, and diversification. Similarly, where analyzing contingent credit risk, ISDA has sought to link default correlation with essential parameters, such as the country of incorporation and industry of the obligors. Economic consistency is a pre-requisite for the proportionate recognition of risk mitigation (credit derivatives, operational risk insurance). Finally, ISDA strongly advocates the recognition of banks potential future exposure measures by the regulators in the calculation of counterparty risk charges. Simplicity: Regulators should also seek to avoid excessive complexity in developing new capital rules. These need to remain sufficiently simple, although robust, in order not to burden banks with disproportionately high implementation costs. To this end, ISDA suggests a framework for credit risk, where the same matrix of capital requirements applies whether or not the bank has been allowed to use its internal ratings for regulatory purposes. Similarly, the incorporation of credit risk mitigation in the framework is not differentiated according to whether the capital charges are internal ratings or external ratings-based. Incentives for good risk management: Finally, it is essential that regulators consider carefully whether minimum capital requirements are appropriate protection against the forms of risk under consideration. ISDA does not believe that charging against operational risk is sensible, since this risk is mostly endogenous and should therefore normally be addressed by adopting proper systems and controls. Establishing minimum capital charges against operational risk would lead to arbitrage, and runs the risk of discouraging the development of adequate controls, in particular if the charges applied bear little relation to the underlying risk. ISDA would suggest developing an assessment methodology for banks operational risk as part of Pillar II of the review, to ensure at least that regulatory intervention, if warranted, is proportionate to the level of risk incurred and quality of the controls in place. Similarly, it is proposed to address interest rate risk in the banking book as part of Pillar II. From a broader standpoint, ISDA welcomes the Committees emphasis on increased and improved supervision and also supports Pillar III of the review, in as much as disclosure can effectively foster market discipline. Throughout the response drafting process, ISDA has kept in close contact with banking regulators around the world, in the hope of being able to influence the Basel debate in its early stages. ISDA held discussions with the U. S. U. K. Japanese and French regulators, as well as the Basel Committees Models Task Force and the EU Commission. ISDA is a member of the U. K. Financial Services Authority Advisory Group on the review of the capital adequacy framework. ISDA has been invited by the Basel Committees Models Task Force to participate in a data-gathering project on loss given default (LGD), exposure at default and credit risk capital allocations. ISDA has welcomed this proposal for further dialogue, and hopes to be able to provide the regulators with meaningful information. ISDA will also produce a response in March 2000 to the European Commission consultative paper on capital adequacy, specifically addressing the comparative regulatory treatment of banks and securities firms. Credit Risk Modelling The testing exercise conducted jointly with the Institute of International Finance came to an end in late 1999. This concludes nearly two years of both quantitative and qualitative work on portfolio credit risk models, coordinated by both associations and involving 25 banks. This important piece of work has provided participants with a unique opportunity to compare models, in both their theoretical make-up and internal implementation. A major lesson learned from the testing process has been that models are directionally consistent, in other words react similarly to similar shocks, and that loss measures obtained for a given standardized portfolio tend to be consistent within model types. Further initiatives were launched during 1999 in the field of credit risk modelling, with a view to addressing the weaknesses that the Basel Committee believes prevent reliance on models for regulatory purposes: data scarcity and validation difficulties. As far as data is concerned, ISDA has initiated, together with Robert Morris Associates and the British Bankers Association, an LGD data pooling exercise for European banks. This will produce a European LGD benchmark, for use by members as a key input into their credit risk modelling, and by regulators, as a starting point where seeking to establish the reasonableness of banks LGD assumptions. In the field of model validation, ISDA has launched a joint project with the International Association of Financial Engineers, to create a library of academic-industry projects on credit risk modelling and validation. This will provide our membership with an opportunity to take part in some of the most advanced academic studies on this topic. Participation from regulators in this research pool is also envisaged. In 1999, ISDA continued to monitor and provide feedback to regulators on policy regarding the regulatory treatment of credit derivatives. The last year saw changes in regulation in Australia and Hong Kong and Singapore. In July, ISDA responded to guidance published by the Australian Prudential Regulation Authority (APRA). The Association welcomed the retention of trading book eligibility criteria and the treatment of maturity mismatches in the banking book: APRA proposes partial capital relief in tune with ISDAs proposal for a sliding scale of charges for forward credit risk. The Association further supported the treatment of maturity mismatches in the trading book, where APRA applies one specific charge as opposed to the two applied in some other jurisdictions. ISDA however, felt that the approach to first-to-default basket products was unduly conservative for both protection sellers and buyers. The Association also expressed concern about the lack of recognition of specific risk offsets in the trading book. In the autumn of 1999, ISDA studied proposals for new regulation produced by the Hong Kong Monetary Authority (HKMA). This guidance focused on credit derivatives in the banking book only. ISDA urged HKMA to clarify their approach to trading book eligibility. Transparency was also needed with regard to the treatment of maturity mismatches in the banking book, and of multiple name credit derivatives. Operational Risk Survey During 1999, the Association, in conjunction with the British Bankers Association and Robert Morris Associates (RMA), undertook a detailed and groundbreaking study of operational risk management. The study describes current practice and thinking on the definition, measurement and management of operational risk. Fifty-five major global financial institutions responded to a detailed survey questionnaire. The resulting study represents the first publicly available analysis and report on the rapidly evolving subject of operational risk technology. In addition to describing current organizational structures, policies, practices, and procedures, the study suggests alternative methods for managing operational risk and provides a methodology for approaching risk on an enterprise-wide basis. Exhibits and data track the evolution of operational risk management, providing a road map for institutions beginning to implement operational risk programs. The study also distinguishes between strategies utilized in a centralized management structure and those in place at the business unit level. Some of the topics addressed in the study include: Operational Risk and Shareholder Value Defining Operational Risk Trends in Organizing an Operational Risk Management Structure and Reporting An Inventory of Operational Risk Management Tools Including Self Assessment, Risk MapsProcess Flows, Risk Indicators, Escalation Triggers, Loss Event Database and the Integrated Use of Tools and Insurance Strategies. Interest in the survey has been widespread among institutions and industry regulators. In October, the Association, BBA and RMA accepted an invitation to present the preliminary results of the survey to the Basle Risk Management Committee. A successful presentation was also made at the Asian Regulators Forum in Singapore in October. In addition, the survey findings were discussed at conferences in London and New York in November. The survey is available on the ISDA website (isda. org). Risk Management Seminar Program ISDA continued its monthly lunchtime seminars in New York and London on risk management. These seminars provide useful updates on industry best practice and research in the field of risk management. A mix of institutions is represented, including practitioners, consultants, rating agencies and academics. The 1999 program focused primarily on operational risk and credit risk measurementmanagement. North American Program 1999 EUROPEAN REGULATORY ACTIVITIES European Commission Action Plan The impetus to create a genuine single market in financial services which had witnessed the establishment in 1998, with ISDA involvement, of the Strategy Review Group (SRG) continued into 1999. EU Finance Ministers in May responded to the European Commissions Communication on the work of the SRG by agreeing an important Action Plan on the steps needed to complete the single market. ISDA successfully lobbied Ministers on the need to move ahead more rapidly in the area of wholesale capital markets, where our priorities remained the need to allow interprofessional business to be regulated on a country of origin (or home country) basis, the need for action on collateral, and the need for more flexible legislation. The Action Plan priorities reflect these points. Over the summer, the Commission established five Forum Groups of industry experts from across the EU to advise on how to proceed and to translate these priorities into action. ISDA is represented by members on three groups: reform of the Investment Services Directive (ISD), collateral and market manipulation. Meanwhile, the high level financial services policy group Ministers set up at the Vienna European Council continued to meet to monitor progress. No concrete measures have, however, yet been proposed. Another important development in 1999 was the growing influence of the Forum of European Securities Supervisors (FESCO). In November 1999, FESCO issued a consultation paper on a proposed common definition of a professional investor. FESCO proposes defining authorized firms as professional, with sophisticated non-authorized firms able to opt in to that category. But it proposes no differentiation at this stage in the rules applicable, other than suggesting that more general principles might be appropriate for professionals. ISDA issued a response jointly with two other wholesale market trade associations calling for a more flexible definition that would more easily allow sophisticated investors to be treated as professional. ISDA also sent a paper to the ISD Forum group calling for home country control for interprofessional business. The European Commission indicated that it would follow the FESCO paper with a Communication in 2000 recommending how it should be applied in the context of the EU Directives and is thought to be sympathetic to ISDAs position. ISDA discussed both the FESCO paper and the implications for the ISD with the German, French and U. K. supervisors during late 1999. All are sympathetic to the need to treat professional investors with a lighter regulatory touch, but are unlikely to agree readily that home country control is the logical next step. Both FESCO and the Forum Group are similarly preparing the ground for European Commission action on market manipulation. Given the concerns over the changes to the U. K. regime in this area, ISDA will prepare a paper outlining the difficulties of proceeding with a directive when national differences in how manipulation is defined and policed persist and when there is no agreement on whether enforcement should be by home or host state competent authorities. European Parliament Intergroup on Financial Services ISDA passed the chairmanship of the industry advisory committee of the Intergroup to ABN AMRO for 1999. ISDA continued to work with the committee to raise the profile of financial services in the Parliament, and held several productive discussions, notably on the EU Action Plan and on electronic commerce. The 1999 elections, however, naturally interrupted our activities and, furthermore, the formal position of the Intergroup was thrown into question by the decision of the new Parliament to suspend all such groups pending a review. The Advisory Committee has decided nevertheless to continue with its activities as a forum for liaison with the Parliament and will continue with a full program for 2000. U. K. Financial Services Authority (FSA) Given the key role of London as a centre of OTC activity in Europe, ISDA has continued to follow the establishment of the FSA with great interest. The legislation creating the FSA as an integrated regulator spent most of 1999 in the U. K. Houses of Parliament and despite the constitutional innovations of a joint committee between the two Houses and the carrying over of the bill between two sessions, progress is being made slowly. Agreement is, however, likely in late Spring 2000. Industry lobbying focused on two main issues: the need for checks and balances on the FSAs new enforcement powers, which appear at odds with the European Convention on Human Rights, and on the need for the FSAs market abuse regime to include only intentional market manipulation. ISDA worked with a number of U. K. and international trade associations on these and a host of other issues throughout the year. On enforcement, the Government appears to have given some ground. The position on market abuse remains of some concern, since the Government refused to include an intent provision, but amendments to include a reasonable behaviour defence have been added and the FSA market code, to follow the bill, is expected to expand on this and to clarify that acting in accordance with FSA guidance provides a safe harbor. ISDA also provided comment in 1999 on various FSA consultative papers and participated in FSA discussions on a number of issues. The key topics for 2000 will be the emergence of new integrated prudential and conduct of business rulebooks, the FSA regime for interprofessional business and the FSA market abuse code. Settlement Finality Directive ISDA continued to monitor the implementation by member states of this Directive, which protects payment and securities settlement systems from action by liquidators which could unwind transactions and create systemic contagion effects. Article 9(2) of the Directive held particular promise by appearing to define the law applicable to dematerialized securities as the law governing the book entry system where they are held. This would be a welcome clarification in many situations, especially in the case of collateral held in the form of dematerialized securities and pledged between two participants in different jurisdictions. It appeared in subsequent discussions, however, that this Article does not require member states to apply it in all cases. ISDA has therefore joined others in pressing member states to implement it in a broad sense. Most member states, with the notable exception of Spain and the U. K. seem to have done so. U. S. REGULATORY ACTIVITIES There were three major areas of interest for ISDA in this regard in 1999: reform of the Commodity Exchange Act (CEA) financial services reform and bankruptcy reform. Reform of the Commodity Exchange As the U. S. Congress began to focus on reauthorization of the Commodity Futures Trading Commission, whose authorization expires September 30, 2000, the reform of the Commodity Exchange Act quickly became a focus of ISDAs North American regulatory efforts in 1999. ISDA participated in a number of legislative forums throughout 1999 in an effort to further the agenda for Congress to provide legal certainty for the OTC markets. Two ISDA Board members, Charles Smithson of CIBC and Ernest Patrikis of AIG, joined other businessmen, academics and regulators at a two-day roundtable held by the Senate and House Agriculture Committees at the end of February to discuss a wide range of issues in relation to both privately negotiated and exchange-traded derivatives. The Association also met with representatives of the Chicago Mercantile Exchange and the Chicago Board of Trade to discuss and consider their proposals for reform of the CEA. The Subcommittee on Risk Management and Specialty Crops of the House of Representatives Agriculture Committee held hearings on the CEA in May, at which ISDA was represented by Joe Bauman of Bank of America. Mr. Bauman stated ISDAs views that Congress should take legislative action to clarify that the CEA does not apply to OTC derivatives transactions and that Congress should also provide regulatory relief to the U. S. futures exchanges. In May, ISDA joined eight other industry groups in a letter to Rep. Tom Ewing, Chairman of the Subcommittee, urging Congressional action on reform of the CEA consistent with ISDAs objectives to provide greater legal certainty and promote market efficiency. On July 22, Rick Grove attended a working group hosted by Chairman Ewing to discuss a wide range of issues relating to the CEA. There, Mr. Grove reiterated ISDAs stance, which was supported by a number of other working group members. On November 9, 1999, the U. S. Presidents Working Group on Financial Markets issued its report Over the Counter Derivatives Markets and the Commodity Exchange Act. The reports recommendations (which were unanimously supported by the Secretary of the Department of the Treasury, the Chairman of the Board of Governors of the Federal Reserve, the Chairman of the Securities Exchange Commission and the Chairman of the Commodity Futures Trading Commission, reaffirmed the need for legal certainty for OTC markets and urged Congress, among other things, to exclude from the CEA bilateral transactions (other than transaction involving non-financial commodities with finite supply) between sophisticated counterparties. Eight key financial groups joined ISDA in issuing a statement applauding the report and urging Congress to legislate legal certainty for the OTC derivatives markets. ISDAs only concern, which it raised with members of Congress and federal agencies, was the lack of CEA exclusion for energy and other commodity derivatives if they were considered to be transactions involving non-financial commodities with finite supply. During 2000, ISDA will parti cipate in Congressional hearings and will continue to work with the U. S. Congress and U. S. regulatory agencies to pass legislation implementing the recommendations of the Presidents Working Group. ISDA worked throughout the year to promote the passage of legislation to modernize the U. S. financial services system and to remove archaic boundaries to competition and market development. Just before their August recess, both houses of Congress passed version of financial modernization legislation. A conference committee quickly reconciled differences between the two versions, and in October 1999, a legislative milestone was reached with the passage into law of the Gramm-Leach-Bliley Act on financial modernization. The legislation established that commercial banks are able to conduct a wide rage of swap activities without interference from non-bank regulators. ISDA has been lobbying in favor of such a provision for many years. With the exception of a narrow class of retail equity swaps, banks will be able to conduct this business without any requirement that transactions be booked in or effected through any other entities. Throughout the consideration of the legislation, ISDA worked very closely with its members, consultants and other organizations to achieve this beneficial result. The Association continued to support the passage of bankruptcy reform legislation that clearly recognizes cross-product netting and promotes greater certainty for the netting of financial contracts. Bankruptcy reform provisions that affect financial contracts have wide support but have been included in legislation that includes more controversial consumer provisions. The U. S. Presidents Working Group on Financial Markets Over the Counter Derivatives Markets and the Commodity Exchange Act supported enactment of improvements in the netting regime for derivatives transactions under the U. S. Bankruptcy Code, echoing the recommendations in the Working Groups report on highly leveraged institutions, published in April 1999. ISDA will continue in 2000 to lobby strongly for appropriate legislative action in this regard. OTHER REGULATORY DEVELOPMENTS Reduction of Collateral Call CyclesThe Review was very well received by the industry, receiving the support of the Counterparty Risk Management Policy Group and a number of industry regulators. About half of the recommendations contained in the Review addressed improvements in collateral documentation. In July 1999, ISDA organized a further two-day offsite for senior collateral practitioners to discuss how the various recommendations should be implemented. This in turn led to the publication, in October 1999, of the first draft of a detailed set of instructions to external counsel requesting the development of revised ISDA collateral documentation that will reflect the improvements in collateral management practices suggested by the Review. It is intended that a revised set of ISDA collateral documentation (provisionally entitled the 2000 ISDA Credit Support Provisions) will be finalized during 2000. ISDA Collateral Benchmarking Survey The Review contains a summary survey of collateral volumes and management practices as of early 1999. Industry practitioners recommended that a more extensive survey of market practice would be of considerable value. During 1999, ISDA began to undertake such survey. A questionnaire containing approximately one-hundred questions, aimed at assimilating essential data, was prepared and was distributed to ninety-two institutions. The results of the survey will: Facilitate assessment of the challenges faced by collateral practitioners Indicate the operational standards to which institutions intending to manage collateral should aspire and Provide a benchmark against which institutions that already manage collateral can assess the efficiency of their operations relative to other industry participants. It is intended that the survey will be completed in the first quarter of 2000. European Collateral Law Reform Project In February 1999, ISDA formed the European Collateral Law Reform Group as a small ad hoc working group, whose brief was to map out the case for improving the legal infrastructure for secured transactions across the European Union. The group was asked to build on the paper ISDA had submitted to the European Commissions Strategy Review Group in 1998 in which ISDA had called for action in this area. As the groups work progressed, it quickly became apparent that there were issues that could and should be addressed in virtually every EU jurisdiction, and possibly at the EU level too. By the end of the year, the group delivered a report (available on the ISDA website) making a clear and compelling case for action. The report calls for European collateral arrangements to be based on the following key principles: Appropriate Rules: rules and procedures for implementing and maintaining a collateral arrangement should be simple, clear and cost-effective. Reduction of Formalities: cumbersome formalities such as registration, notification, filing and similar requirements should be abolished. Ability to Reuse Collateral: a collateral taker should be free to deal with the collateral until it is required to return it. Protection from Insolvency . a giver of pledge collateral (a pledgor) should be protected from the insolvency of the taker of that collateral (the pledgee). Law Chosen by Parties Should Govern: the law governing the creation and priority of the collateral arrangement should be the law chosen by the parties. Choice of Law Where No Law is Chosen: where no law has been chosen by the parties, the governing law should be the law of the place where the collateral is held, collateral held through an intermediary being deemed held where the intermediary maintains the account, register or other official record representing such collateral. Clarification of Status: the legal nature of a partys holding of securities in a clearing system should be clarified. Protection Against Third Parties: collateral arrangements should be protected from the rights of third parties. Protection Against Preferences: top-up deliveries of collateral under mark-to-market collateral arrangements should be protected from avoidance under preference and similar insolvency rules. At the same time as the Europe-wide summary report from which these principles are taken, this group also completed papers on each of the 15 EU jurisdictions, allowing market participants and authorities to compare and contrast in detail the situation in the constituent parts of the single European market. Use of collateral in connection with financial transactions is growing rapidly and the potential is particularly great in Europe. Legal obstacles represent an unnecessary barrier to that growth. On the positive side, the European Commission and the European Central Bank have both demonstrated their support for a more effective collateral regime for Europe and collateral features as a high priority action point in the Action Plan agreed by EU Finance Ministers in May 1999. In September, the European Commission set up a consultative Forum group to study the issue further. ISDA continues to work with the EU institutions and the Forum group going into the year 2000. At the same time, the work of the European Collateral Law Reform Group has attracted participation from the broad ISDA membership, making this project a major part of ISDAs portfolio. EUROPEAN ECONOMIC AND MONETARY UNION (EMU) Following extensive preparations in 1998, ISDA was not surprised by the smooth changeover to the euro. ISDAs five EMU Task Forces - Market Practice Documentation Operations Accounting Tax amp Capital and Legal amp Regulatory - had been instrumental over the previous two years in identifying the critical issues and finding solutions well in advance of the actual introduction of the euro. Some 1,200 members were active in these five Task Forces. ISDAs commitment to assisting the market in ensuring a smooth changeover was documented in the various publications, memorandums and updates such as ISDAs EMU Protocol and ISDAs Operations Guidelines, contained in the EMU Guidebook. Following the introduction of the euro, ISDA re-structured its Task Forces by forming the Euro Committee in its place. The Euro Committee met several times during the course of 1999 allowing members to reflect on their first experiences with the euro and discuss a number of post conversion issues. Euro Swap Conventions - reconfirmed in 1999: Floating day count basis: Actual360 Fixed rate day count basis: 30360 Business days: TARGET operating days should form the basis for euro business days Fixing period: two day rate fixing convention Coupon frequency: annual At the beginning of 1999, members of the Euro Committee agreed that it would be helpful to survey how market participants were applying the day count convention of ActualActual. As a result, ISDA published a survey which was distributed to all interested members and which aimed to provide feedback on the use of the euro conventions, as well as the treatment of legacy trades. The survey confirmed that the majority of euro trades (i. e. plain vanilla euro interest rate swaps) used 30360 as the fixed rate day count fraction. However, the survey also revealed that for euro swaps in which the fixed payments are designed to match cashflows on a fixed rate bond issue, the day count fraction applicable to the bond (typically, ActualActual) was used. The survey also indicated that more than one method of calculating ActualActual was being used. Discussions at the Euro Committee meeting showed that members would like ISDA to provide standard definitions allowing for the documentation of trades according to alternatives such as the ISMA and AFB methods. Accordingly, ISDA developed language intended to serve as a basis for incorporation into the 2000 ISDA Definitions, ultimately allowing members to document ActualActual according to the ISMA and AFB methods. In addition, market practice concerning EURIBOR rounding and interpolation has led ISDA to review the language in the 1991 ISDA Definitions and conclusions reached in the meetings of the Euro Committee also influenced the drafting reflected in the 2000 ISDA Definitions. The Euro Committee further discussed the question of which calendar to use for the settlement of ECU trades. The appropriateness of the approach taken by the majority of market participants, namely to follow the unofficial recommendation by the European Banking Federation (EBF) and use TARGET business days as the successor to ECU settlement days, was subsequently confirmed by the Bank of England in their PIQ (Practical Issues Quarterly), published on June 4. Members raised particular concern about the lack of available information in regard to national holiday calendars and TARGET operating days. ISDA has called on the European Commission and European Banking Federation to provide national holiday calendars as soon as possible and ISDA has also urged the European Central Bank to clarify when TARGET is expected to close in the years beyond 2000. A further matter that arose towards the end of 1999, following the announcement of additional TARGET settlement days, was the need for clarification on how to obtain a settlement rate for legacy trades (which are settled according to pre-1999 business day conventions) on national banking days which are not TARGET business days. ISDA continues to pursue this matter with the EBF, which sponsors EURIBOR. ISDA continues to discuss these topics with members of the Euro Committee. Further efforts will include consideration of whether there is a need to facilitate the redenomination of outstanding legacy transactions and the adoption of the euro by other countries going forward. ACCOUNTING amp DISCLOSURE ISDA continued to monitor developments in the field of accounting and disclosure in Europe throughout the year. The effects of standard setters interest in mark-to-market valuation for financial instruments is beginning to be felt. A disclosure recommendation from the European Commission was issued for comment and the possibility of a European Accounting Standards Board discussed. Many European members of ISDA are already affected by U. S. FAS 133, by virtue of having a U. S. listing. In this context, the position and influence of the London-based International Accounting Standards Committee is being closely monitored. As in North America, many firms continue to have serious concerns about the seemingly unstoppable move to fair-value accounting. Even where the principle is accepted, implementation remains an issue. The Federal Accounting Standards Board (FASB) voted on May 19 to delay the date for implementation of FAS 133 (Accounting for Derivative Instruments and Hedging Activities) for one year to fiscal years beginning after June 15, 2000, citing Y2K reprogramming concerns as the reason. ISDA submitted a letter in early May supporting calls for the delay. Also during the year, ISDA commented on the FASBs Exposure Draft regarding Transfer of Financial Assets, an amendment to FAS 125 that deals with recognition and measurement of the right to sell or repledge collateral held. In its comments, ISDA agreed with the Boards theoretical basis for recording the fair value of the contractual right to sell or repledge collateral by both the pledgor and receiver of collateral. ISDA also emphasized however that recording assets and liabilities as separate contractual rights is inappropriate when viewed in the context of a costbenefit analysis, since the value of the collateral rights are immaterial compared to the value of the related balance sheet amounts. ISDA supported an approach that does not require the reporting of the contractual rights and requires the recording of collateral assets only when a debtor defaults and is no longer entitled to redeem the collateral. In early 2000, FASB issued its final guidance which did not require the reporting of contractual rights. A new undertaking for ISDA in 1999 was the formation of an important new committee on equity derivatives. The Committee unites front-office and legal specialists and met for the first time in September. It has rapidly built up a portfolio of issues and addressed the more immediate ones, including the effect of changes to the method of calculating certain FTSE indices, at its first meeting in London in September 1999. More generally, the aim is to pursue further standardisation in relation to equity derivatives business practices, building on the platform established by the 1996 Equity Derivative Definitions. This includes promoting dialogue on how to provide for various forms of corporate action, where greater consensus would be of benefit to the market. The Committee is also monitoring accounting issues and reviewing training needs. ISDAs Energy Derivatives Committee identified standardization of documentation as its main challenge, given deregulation in the energy markets in Europe and the U. S. Existing transaction agreements do not address the sophisticated issues that can arise and, as trading increases globally, there will be a need for common documentation approaches. ISDA is revising the 1993 Commodities Definitions to include additional North American and European price sources, substantially increasing the scope of the document. ISDA membership in the energy community has continued to increase, and the committee is poised to play a larger role in 2000. During 1999, the work of ISDAs Operations Committee focused on technology developments in derivatives processing, with particular emphasis electronic messaging and automation of back office processes. ISDA reviewed vendor and industry-proposed solutions aimed at automating operations processes and observed and encouraged individual member efforts to achieve straight-through processing. ISDA prepared a memorandum to the membership reaffirming the acceptability of electronic confirmations in the event that certain members needed assurance that faxes, telexes, SWIFT and other automated messages can be used to confirm derivatives transactions. As FpML becomes an industry driven initiative, ISDA is staying abreast of its development to ensure its viability within the ISDA Operations and Documentation framework. In the last quarter of 1999, the Association developed an Operations Benchmarking Survey to address the membership needs for clear benchmarks for operations processing. The Operations Committee worked to develop the survey with an eye to understanding the challenges ahead of the business considering the mounting pressures of increased volumes, the pressure to decrease costs as well as to satisfy regulatory interests in operational risk. ISDA Par Rate Screens During 1999, there was an increasing acceptance of the screen service produced by the Association in cooperation with Reuters and Garban Intercapital Brokers Ltd. to facilitate the determination of the values of cash settled swap options. The relevant screens can be found at Reuters pages ISDAFIX1 through ISDAFIX4 (with backup information being displayed on Reuters pages ISDA10 through ISDA47). Following the introduction of the euro, new screens were established early in the year that benchmark against both EURIBOR and euro LIBOR. Currently, mid-market swap rates are published in relation to euro, U. S. Dollars, Japanese Yen, Sterling and Swiss Francs at various maturities. Enhancements to the service in September strengthened the rates and extended their application. Yen and euro rate tenors were extended to twenty and thirty years respectively. Quotes for EURIBOR and euro LIBOR are now displayed at both 11:00 a. m. Frankfurt time and 11:00 a. m. London time. Successful changes were made to panel compositions which have led to more consistent and regular quoting. The ISDA Market Practice Committee focuses on issues of concern to the trading community. Committee members considered the introduction of a presumption of automatic exercise of options to alleviate the potentially expensive problem of missed exercise of in-the-money options. Discussions in this regard will be reflected in the 2000 ISDA Definitions. The Committee also considered the establishment of parameters for the use of mutual puts however, no consensus has been reached on this. Other topics of interest to the Committee include the consolidation of portfolios between large counterparties, the potential impact of e-commerce on trading and electronic clearing and settlement systems. During 1999, ISDA continued its Confidential market survey activities, publishing the 1998 Year End Market Survey details for interest rate swaps, currency swaps and interest rate option products in 17 currencies. The figures for 1998 showed that notional principal outstandings continued strong growth during market disruptions in that year. The semiannual market report issued by the Association in June 1999 showed that worldwide growth in the use of privately negotiated derivatives, as measured in the notional principal of outstanding transactions, slowed to 3.4 in the first half of 1999. Notional amounts totaled 52.711 trillion at June 30, 1999 compared to 50.997 trillion six months earlier and 36.974 trillion one year earlier. The slowdown was believed to reflect the return of credit and currency stability from the exceptional volatilities associated with the Asian crisis, the Russian bond default and other events in the previous two years. Year-end figures for 1999 will be made available in the first quarter of 2000. Please click here for summaries of the survey results. As of 1998, ISDA streamlined its reporting, only collecting aggregate Flash Survey statistics for interest rate and currency swaps and interest rate option products. The Bank for International Settlements now produces a comprehensive survey of all segments of the OTC derivatives markets. During 1999, the Tax Committee monitored two issues of significance to the financial markets. The first of these was the now withdrawn Italian withholding tax on Italian-sourced derivatives. ISDA sought to clarify how firms should deal with the effects of the brief period when the tax was in force. The second issue addressed by the Committee was the potential introduction of a withholding tax on interest income across the European Union. This remains an issue as we approach 2000 and ISDA will continue to monitor any impact, direct or indirect, that this may have on derivatives markets. The Tax Committee wrote a letter in September to the Treasury and to the United States Internal Revenue Service urging the appropriateness of using values determined for financial reporting purposes for valuing derivatives for tax purposes. In addition, representatives of the Association and its membership met with Treasury and IRS officials in November to explain ISDAs position. The outcome of the meeting was further interest from the Service to learn more regarding various mark to market accounting methods. At the close of 1999, the issue remains open and ISDA will continue to educate the IRS and Treasury on its position as the need for clarity regarding appropriate valuing methods for derivatives transactions. The following is a list of the conferences organized by ISDA during 1999.
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