ISDA Master Agreement Documentation This course is presented in London on: 20 April 2018, 31 October 2018

Transcription

1 ISDA Master Agreement Documentation This course is presented in London on: 20 April 2018, 31 October 2018 The Banking and Corporate Finance Training Specialist

2 Course Objectives Participants will: Be introduced to the different types of derivatives including equity derivatives and property derivatives. Get an overview of their legal definition and type of risks hedged. Have explained to them the ISDA Master Agreement with a detailed clause by clause review and Course a comparison Overview of ISDA 2002 and 1992 Master Agreements Master the schedule to the ISDA Master Agreement Gain an understanding of the ISDA confirmation and the process on how trades are done. Learn about the ISDA protocols, ISDA credit support annexes and credit support deeds. Be appraised of financial collateral regulations. Be taught about netting and valuation Have an overview of the events of default and termination events. Background of the trainer Trained as a lawyer, the trainer has over 19 years experience in international banking and structured finance transactions, including real estate finance, loans, leverage finance, debt capital markets, securitisation, structured products, repos, derivatives and financial regulatory and compliance. She has been actively involved in the creation of innovative award winning structured transactions and negotiating complex financings. She has advised global institutions such as Credit Suisse, Citigroup and Goldman Sachs and spent many years practicing law at Allen & Overy LLP, Linklaters and Sidley Austin Brown & Wood in multiple jurisdictions including London, New York, Hong Kong, Singapore etc. She holds a Law LLB (Hons) degree from University College London and has worked in the Finance Know-how team at Clifford Chance. She is an author and now runs her own business advisory, training and legal consultancy. Course Content Introduction: Derivatives overview What are derivatives? Legal definition Types of risks hedged Over the counter (OTC) vs Exchange traded Types of derivatives Swaps Options Forwards and Futures Equity derivatives Credit derivatives Swaption

3 Total Return Swaps Property derivatives Synthetic ISDA Documentation Introduction The ISDA Architecture of the ISDA documentation 1992 multi-currency cross-border version 1992 local currency single jurisdiction version 2002 version Summary of the ISDA documents and protocols ISDA Master Agreement Detailed clause by clause review (2002) Single Agreement Cherry picking Netting legal opinions Governing law on insolvency Conditions Precedent Withholding tax Representations Undertakings Events of Default Termination Events Early Termination Transfer Multi-branch Parties Waiver of immunity Arbitration clauses Comparison of ISDA 2002 and 1992 Master Agreements Events of default provisions Grace periods Scope of the credit support default Breach of agreement Specified Transactions Cross default provisions Merger without assumption Termination Events Scope of Illegality Force Majeure Grace periods Tax event upon merger Methodology of calculating payments on early termination First Method Second Method Market Quotation Loss Set-off Unpaid amounts

4 Close-out amount Schedule to ISDA Master Agreement Parts 1 to 5 Negotiating points EMIR related amendments Relevant EMIR Protocols: 2013 EMIR Non-Financial Counterparty Representation 2013 Reporting Protocol 2013 EMIR Portfolio Reconciliation, Dispute Resolution and Disclosure Protocol Adherence Letters Suggested EMIR Related Amendments ISDA Confirmation Process on how trades are done EMIR reporting 2013 EMIR Reporting Protocol Grey area ISDA Definitions ISDA Protocols ISDA Credit Support Annexes and Credit Support Deeds Legal opinions English law deeds and annexes New York law annexes 1995 ISDA Credit Support Annex Close-out netting Valuation agent Eligible Credit Support Haircuts and Valuation Percentages Financial Collateral Regulations Title transfer Ring fencing Close-out netting on insolvency Netting and Valuation Settlement Netting Close-out Netting Calculations Mark to market valuations How Swaps are Valued Events of Default and Termination Events Step to follow on Early Termination Conditions Precedent Timeline summary of process Checklists Contractual terms breach Events of Default and Termination Events Legal, commercial and operational considerations

5 Early Termination Procedures Case law Counterparty issues Hammersmith & Fulham Credit Suisse International v Stichting Vestia Groep Section 2(a)(iii) Lomas and others v JFB Firth Rixson Inc. and others ISDA Amendment GROUP CASE STUDY: Participants to work in small groups to draft and negotiate with another group a first draft of the ISDA Schedule to the 2002 ISDA Master Agreement in accordance with the client instructions provided in the case study pack Course Summary This ISDA Documentation course covers pertinent issues related to the drafting, negotiating and understanding of the ISDA Documentation. This course is relevant for: 1. Lawyers both in private practice and in-house, 2. Traders, Bankers and Structurers involved in transactions involving swaps, CDSs, options, swaptions etc., 3. Operations teams involved with swaps, EMIR reporting etc., 4. ISDA documentation teams who typically draft and negotiate ISDA trades, and 5. Accountants who advise clients on swap transactions. The first part of this course sets the scene by giving an introduction to derivatives and the various types of derivative products in the market showing the potential of the use of derivatives in a wide range of product sectors. The second part of the course we go through the ISDA documentation framework. Here a detailed clause by clause analysis will be undertaken of the ISDA Master Agreement followed by a comparison analysis between the 1992 and the 2002 ISDA Master Agreements. We will undertake a detailed analysis of the ISDA Schedule including any EMIR Regulation related language. We will then discuss the CSA, the Financial Collateral Regulations relating to the CSA specifically and the ancillary ISDA documentation. We will then go through in detail the settlement netting and close-out netting and the calculations involved including how swaps are valued. We will cover off the Events of Default and Termination Events operative provisions, procedural timelines and checklists outlining the notice requirements, legal, commercial and operational points to tick off the list. We then cover off some case law and amendments to the ISDA Master Agreement. The third and final part of the course will be an Interactive Group Case Study involving the documenting an ISDA Schedule and key issues to consider. COPIES OF THE 2002 ISDA MASTER AGREEMENT AND THE ACCOMPANYING ISDA SCHEDULE WILL BE PROVIDED TO ALL PARTICIPANTS AS PART OF THIS COURSE.

6 What Redcliffe s clients are saying about the course; Excellent trainer, very knowledgeable and kept everyone interested through what is an unavoidably dry subject The trainer and materials were excellent The trainer was very knowledgeable 09:30-17:00 London Standard Price: 625+VAT Membership Price: VAT Delivering this course in-house for you to a number of participants could be very cost effective.