International Banker: Common Problems, Mutualized Solutions

“To walk onto a modern trading floor is to witness the extraordinary power of technology in changing the way business is conducted. While trades were once struck with esoteric shouts and signals, machines now dominate, with microseconds saved and dollars gained by the smartest systems. Just as smartphones have revolutionized how we communicate and consume information, technology has created unprecedented efficiencies in trading financial instruments. But scratch below the surface, and you’ll find the financial world is not always as automated and efficient as it might appear.

The over-the-counter derivatives market enables governments and companies worldwide to manage their business risks and create greater certainty and stability. Yet, despite its importance, the industry still relies on paper documents, manual pro­cesses and non-standard practices. Unlike on the trading floor, where individual en­tities can yield a competitive advantage by adopting faster and more powerful systems, operational challenges are addressed most effectively when market participants work together to design common solutions.”

ISDA CEO Scott O’Malia wrote an article for the Autumn 2023 edition of International Banker magazine, in which he explores the benefits of mutualized industry solutions to address common challenges in the derivatives market, addressing regulatory initial margin, document negotiation and the physical delivery of critical termination notices.

Click on the attached PDF to read the article in full.

Documents (1) for International Banker: Common Problems, Mutualized Solutions

Response on Commodity Derivatives Markets

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ISDA/IIF Response to EC Market Risk Consultation

On February 22, ISDA and the Institute of International Finance (IIF) submitted a joint response to the European Commission’s (EC) consultation on the application of the market risk prudential framework. The associations believe the capital framework should be risk-appropriate and...

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On April 15, ISDA submitted a response to the Financial Accounting Standards Board’s (FASB) consultation on environmental credits and environmental credit obligations. The response supports the FASB’s overall proposals to establish clear and consistent accounting guidance for environmental credits, but...