Standard CSA: Industry's solution to novation bottleneck gets nearer

Disputes over the valuation of trades backed by multi-currency credit support annex (CSA) agreements – allowing counterparties to post collateral in multiple currencies and assets – have pushed the industry to develop a new standard CSA. Progress is being made, but a number of issues still need to be resolved

Michael Clarke, UBS: multiple methods of collateral settlement would be a "prudent" move

Given the volume of regulatory change being forced through the market, 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 it starts making sense: the existing credit support annex (CSA) has become the source of regular collateral and