Isda in bid to shift master agreements online

The International Swaps and Derivatives Association (Isda) has signed a deal with online negotiations software provider Beachfire to allow over-the-counter (OTC) derivatives master agreements to be negotiated online.

The association believes members will be able to shorten negotiation cycles, improve information sharing and reduce the need for manual re-entry by using the Beachfire Collaborative Agreement Builder software.

“Isda has chosen Beachfire to become what we anticipate will be the global technological standard for online negotiation of derivatives master agreements,” said Isda chief executive Robert Pickel. “[It] will enable our members to dramatically improve the way they put in place Isda master agreements by reducing risk, increasing efficiency, reducing errors and supporting the complex human give-and-take of the negotiation process.”

All negotiation will be drafted, settled and executed in a secure webspace, Isda said. Data used to negotiate contracts will be exportable into other systems, such as risk analysis, portfolio management, netting and collateral management netting software.

As the negotiation process should be quicker than present mechanisms, firms should also be able to take advantage of netting opportunities that allow more trades to be executed within specified regulatory limits.

Isda will demonstrate the new service at its next update meetings, scheduled for September 12 and September 20 in London and New York respectively.