Why is the 2001 ISDA Credit Support Protocol necessary?
The 2001 ISDA Credit Support Protocol was the product of member input following market events in 1997 and 1998, such as the Asian currency crisis and the Russian debt default. These market events necessitated a re-consideration of the credit support documentation and members determined that tightening the timeframes in the documentation, as well as streamlining the dispute resolution procedures and refining the terminology in the documentation was necessary. For an institution to amend all affected contracts to incorporate these standard amendments would involve significant time and expense if undertaken through bilateral negotiation between all counterparties. ISDA is therefore sponsoring a multilateral amendment mechanism – the 2001 ISDA Credit Support Protocol. Parties that have a significant number of credit support arrangements outstanding with counterparties may find the Protocol a useful means of affecting amendments to those existing arrangements. Parties may also wish to consi
