ISDA adopts coupon changes for Asian credit default swap market

By Angela McDaniels

Tacoma, Wash., Dec. 21 - The International Swaps and Derivatives Association, Inc. announced market practice changes to the trading convention for credit default swaps in Japan and Asia ex-Japan that include the adoption of standard coupons and full first coupons in CDS transactions.

Firms will trade Japan CDSs with standard coupons of 25 basis points, 100 bps and 500 bps and full first coupons going forward, according to an ISDA news release.

Firms will trade Asia ex-Japan CDSs with standard coupons of 100 bps and 500 bps and full first coupons going forward.

"These changes are a product of industry-wide dialogue and coordinated efforts among ISDA members to promote standardization, transparency and liquidity in the Asia CDS markets," Keith Noyes, ISDA regional director, Asia Pacific, said in the release.

ISDA noted that the industry adopted fixed coupons in North America in April, in Europe in June and in emerging markets in Europe, the Middle East, Latin America and Australia/New Zealand in September.

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