The push to a new CSA standard

Disputes over the valuation of trades backed by multi-currency credit support annex (CSA) agreements – in other words, those that allow counterparties to post collateral in multiple currencies and assets – has pushed the industry to develop a new standard CSA. Progress is being made, but a number of outstanding issues still need to be resolved. By Nick Sawyer

Given the weight of regulatory change being forced through via the Dodd-Frank Act and European Market Infrastructure Regulation, it might seem strange that the derivatives industry is mobilising so much of its collective effort on a seemingly dull initiative that isn't even on the regulatory agenda - the drawing-up of a new standard template for the exchange of collateral in the over-the-counter market.

Dig a little deeper, however, and the reason becomes glaringly obvious: the existing credit