Insurers enter the credit derivatives restructuring debate

A group of insurance companies active in the credit derivatives market has submitted a letter to the International Swaps and Derivatives Association suggesting language changes to the trade association’s restructuring definitions.

The insurers are pressing for restructuring to be dropped as a credit event and are currently contesting whether Xerox’s debt restructuring should constitute a pay-out trigger.

Kimberley Summe, Isda general counsel, said the restructuring issues have yet to be resolved, and Isda is involved in daily meetings with its G6 credit derivatives working group, which includes hedgers, investors and dealers, to come to an agreement as soon as possible. The insurance companies, which include Financial