Thursday, January 14, 2010

TriOptima terminates $14.5 trillion notional CDS

TriOptima announced that its triReduce multilateral termination service significantly reduced outstanding notionals between dealers in credit default swap (CDS) and interest rate swap (IRS) outstandings during 2009.

With 68 CDS portfolio compression cycles globally, triReduce eliminated $14.5 trillion in CDS notionals, $12 trillion in credit index transactions with an additional $2.5 trillion in European, Asian and Japanese single name and credit tranche transactions. This also included the Thomson index and single name portfolio compression cycles which were the first to be initiated after implementation of the ISDA “Small Bang” protocol.

Multilateral terminations in interest swap transactions virtually doubled in 2009 to $25.8 trillion from $13.6 trillion in 2008. The largest reductions in interdealer notional outstandings were in interest rate swaps in USD ($11.2 trillion), EUR ($8.8 trillion) and JPY ($1.8 trillion). TriOptima offers triReduce termination cycles in 22 currencies globally including AUD, CAD, CHF, CNY, CZX, DKK, EUR, GBP, HKD, HUF, INR, JPY, KRW, MXN, NOK, NZD, PLN, SEK, SGD, TWD, USD, and ZAR.

“We are pleased that we were able to support the industry in its ongoing efforts to reduce OTC derivative notional outstandings,” said Ulf Andersson, triReduce global business manager. “CDS portfolio compression continues strong despite the dramatic reductions through compression in 2008 and the introduction of clearing; while the heightened focus on interest rate swaps is achieving significant results that should continue in 2010.”

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