Isda pushed for electronic documentation of complex swaps

The International Swaps and Derivatives Association today released its recommendations for financial products markup language (FpML) version 2.0 for rates products.

FpML version 2.0 extends interest rate product coverage to include interest rate options, including swaptions, caps and floors and extends the swap definition to include forex resettables, cancellables and early termination provisions. FpML is an XML-based, freely licensed, e-commerce standard supporting over-the-counter trading of financial derivatives.

"Work on the FpML standard is advancing rapidly," said Robert Pickel, Isda chief executive. Pickel said upcoming versions of FpML will focus on equity and credit derivatives, as well as messaging.

The recommendation reflects consensus within FpML as represented by approval from its standards committee. Pickel told RiskNews: “We are working on a version of the master agreement in FpML language – it’s a much better way of going back and forth on an agreement of amendment of an agreement.”