CDS Market Practice Changes for Emerging Markets
Changes will include the following:
With regard to trades for Emerging Markets in Central and Eastern Europe, the Middle East, Africa and Latin America:
Firms will adopt standardized coupons of 100bp and 500bp. Additional coupons for trading or back-loading could be introduced at a later time if and when the need arises;
Firms will switch from semi-annual to quarterly payments and full first coupons. The move to quarterly payments applies to both the existing EM Transaction Types as well as the new Standard EM Transaction Types and has no impact on trades prior to September 21, which will maintain their semi-annual payments even upon novation or assignment.
With regard to trades for emerging markets in Australia and New Zealand, firms will adopt standardized trading coupons of 100bp and 500bp. Additional coupons for trading or back-loading could be introduced at a later time if and when the need arises.