Standardised coupons introduced on loan CDS
New fixed 100bp, 250bp and 500bp coupons aim to promote liquidity and fungibility in LCDS contracts
Fixed coupons have been introduced for single-name North American loan credit default swaps (LCDS), aligning trading practices in the LCDS sector with changes made to the non-loan CDS market under the auspices of the International Swaps and Derivatives Association’s (Isda) 'Big Bang' protocol last April.
Under the changes announced yesterday, North American LCDS transactions will trade with standardised fixed coupons of 100 basis points, 250bp and 500bp with immediate effect.
In addition, LCDS
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