Press release
July 8, 2009
TriOptima supports dealers in eliminating an additional $9 trillion in CDS notional principal in first half of 2009
TriOptima offered 30 triReduce CDS compression cycles in the first half of 2009 enabling CDS dealers, including the Fed 16 banks, to terminate credit default swaps with a notional principal value of $9 trillion. This continued the efforts of dealers to meet their commitments to the international regulators to reduce risk and manage their counterparty risk positions. In 2008, those efforts resulted in the termination of $30.2 trillion of CDS notional outstandings through TriOptima.
“We are working with the dealer community to ensure that they achieve the goals that they have set for themselves in risk management,” said Ulf Andersson, business manager for triReduce, TriOptima’s compression service. “First half 2009 results underscore the significant reductions that have also been reflected in declining outstandings reported by the BIS and the DTCC Trade Information Warehouse. While we will continue to offer CDS compression cycles, notionals terminated may slow down due to the overall reduction in outstandings achieved through triReduce last year and this year.”
The overall downward trend of CDS notionals was reported by the BIS in its May 19th publication on OTC derivatives market activity in the second half of 2008. Total CDS notionals had declined 26.9% to $41.87 trillion in December 2008 from $57.32 trillion in June 2008 with the reporting dealer outstandings going from $33.08 trillion to $25 trillion over the same period. The June 26th data reported to the DTCC Trade Information Warehouse for CDS outstandings indicates total outstandings of $26.54 trillion with interdealer trades accounting for $21.62 trillion.
The triReduce compression service covers a wide range of CDS products including indices (US, European, Asia and emerging markets), single names (European and emerging market), and tranches.
About TriOptima
TriOptima is the award-winning supplier of technology-leveraged post trade processing services including triReduce and triResolve.
triReduce, the portfolio compression service for OTC derivative dealers, pioneers technology that eliminates risk and reduces operational and capital costs. Serving over 135 bank and non-bank subscribers worldwide including the major local and global dealers in derivatives, triReduce is a critical tool for maintaining post trade processing efficiency. triReduce offers compression cycles in single name and index CDS swaps worldwide, IRS swaps in 21 currencies and a range of energy derivatives.
triResolve is a network community service for proactive portfolio reconciliation of OTC derivative portfolios. Used by global dealers, regional banks and buy-side firms, triResolve currently handles 70-75% of all non-cleared OTC derivative transactions globally. The service benefits trade control, settlement, documentation, collateral and counterparty credit risk functions. Web-based, interactive, with advanced matching and reporting capabilities, the triResolve service reconciles all OTC derivative products, from plain vanilla to complex structures.
TriOptima maintains offices in Stockholm, London, New York, Singapore, and Tokyo. TriOptima is a privately-held company owned by its employees and directors with a significant minority interest held by ICAP plc.
For further information please contact:
Susan Hinko, Global Head of Industry Relations
Tel: + 1 646 744 0410
susan.hinko@trioptima.com
Meredith Sledd Lindquist, Global Head of Marketing
Tel: +46 8545 25 664
meredith.sledd.lindquist@triopima.com