ISDA AGM: Credit support agreements grow

The number of credit support agreements between parties trading over the counter derivatives contracts grew 21% to 133,193 since last year, according to the International Swaps and Derivatives Association’s margin survey, previewed last week at its annual general meeting in Boston.

However, the estimated amount of collateral in circulation grew only slightly from last year, reaching $1.335 trillion.

The survey also found that firms are using more collateral to cover counterparty credit exposures. Collateral covered 66% of firms’ credit exposure to credit swaps, up from 62% last year, and 65% of firms' credit exposure to fixed-income swaps was covered this year, up from 57% last year.

“Our 2007 Margin Survey once again underscores the importance of collateralisation and its maturity as a risk mitigation tool,” said Robert Pickel, Isda’s chief executive.

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